New Job and Pension

[crimsonlake]

Wondering if anyone can offer any advice.
Late 50's and I am about to start a new job which has a workplace pension. My issue is that I already have a small teachers pension that I will be able to take in a couple of years. Really wondering if there is any point in paying in to a new pension for however long I remain at this new place of work, whether it be 1 year or until I actually reach retirement age? Or is opting out even an option? Tia.

You can opt out and you can combine pensions

Maybe worth seeing a specialist?

It's free money as employers have to contribute. Check your teacher one, often by delaying taking it for a couple of years you get quite enhanced monthly payments (same for state pension) if you are still able to work. Only can work out personal circumstances

Thanks both for your responses.
GreenTulips, I am hopeless when it comes to pensions. Have no clue about combining pensions either. The issue is that a financial specialist costs and no doubt I will still come away confused.
Stucknoue, confused how it is free money given that I will lose a chunk of it out of my pay each month? 28 hrs a week and above minimum wage so wont be a huge monthly salary and I need every penny and hoping to build up my savings.

Op, if you pay 5% into the new pension, your employer will add their contribution - perhaps another 5%, and the govt will give you your tax back.

So if you pay in £100 a month, your employer will add in another £100 maybe, and the govt will add in £20. Or £40 if your are a higher rate tax payer. So you put in £100 but actually get £220.

Will your employer be contributing to the pension. If yes then great as that's more money on top of what you will be contributing.

You also get tax relief on your contributions.

Definitely pay into the pension. It's the best way to save as it's taken before tax and your employer will pay money in too.

A lot of people opt out of their pensions without really understanding what they're doing!

Blue, I am assuming the new employers will be contributing, thought they had to. I only have another 9 years to work until I reach retirement age so again I suppose this is why I thought it may be pointless.
Having only ever taught all my life my teachers pension is not great as I have been working on supply for the last 20 years and you do not pay in to a pension with this. What do people do I wonder when they have several jobs in their life time, how do you know where to access them all when the time comes. I hope it is not a silly question and thanks again all.

I only have another 9 years to work until I reach retirement age so again I suppose this is why I thought it may be pointless

It’s not pointless. For a lot of people who work for 40-45 years, 9 years of payments means 20% of their pension pot.

A “small” pension from teaching may not go far at all in retirement, so take every opportunity to add to it.

I have a few pensions and so does my DH. We just keep a note of where they all are.

They will all be useful in retirement as we may drawdown on one whilst leaving the others alone for longer etc. One is a small final salary so that will provide a steady income even though it won't be much.

9 years is a long time and you will kick yourself if you don't bother. It's not just about what you put in but also the 'extra' money from tax relief and employer contributions as well as any growth of the fund.

www.pensionwise.gov.uk/en

That's one of the websites that will explain everything to you. You can also go on Money Advice Service.

But basically pension is usually the best way to save and you desperately need more in your pension pot if you only contributed for a few years unless you can happily live on £168.60/week of the max state pension (if you're even eligible for the max amount).

Having several pensions is fine - you just get money from different sources. Also, pension doesn't necessarily mean getting paid a set amount every month. It's also possible to have a pension pot that you take money from as and when you need it. For example, the state+teacher pensions might cover your day to day expenses but then you'll take money out of your other pot for a cruise or a new car as and when you want it.

Anyway, your first step should be getting clued up and then speaking to an IFA.

I work for in IT and have 9 smaller pensions from different employers. I have a spreadsheet with all the details. They each send me a valuation once a year, I update the spreadsheet.

Now some of them are going on-line so I can check the value myself. It’s easy.

If you can afford it, OP, I would join.

DH and I have several small pensions between us. He also has a medium sized teachers' pension as he taught part time for almost 20 years and then virtually full time for the last 10 years of his working life.
We both were able to retire at 59, (DH 5 years before me due to being 5 years older.) DH saves all his State pension and part of his private pensions, I live just on my 3 small private pensions - one being a final salary one - and will also be able to save my State Pension once I am old enough to qualify. We are VERY comfortable and mortgage free.

DH arranged pretty much everything so we could be in this position. I was very unsure about certain pensions at times too but he was absolutely right.

Some really useful advice for me to think about and it appears I should pay in to it.You have all been so generous with your time and advice.
Just another question if you do not mind whilst on the subject of pension...
I have a SIPP also, my ex set it up in my name before we split and at the time I had no knowledge of it.
I know that once I reached the age of 55 years I could take 25% of it tax free and draw down the rest as an annuity ( not really sure what that is either ) I have just left it sitting there and never added to it. I think it is a Stocks and Shares one? It tells me the stock value, cash value, total value and available amount.
Sounds silly but which value should I be looking at if I am thinking of drawing it down ( if that is the correct term?)I am assuming the total
value? Basically should I continue to leave it there or take it now. Have no idea about it other when I queried a couple of years back and they said the annuity would pay out about £75 monthly. Clueless really should have been the title of this thread.

The total amount is the full pot. Annuity is when you buy a monthly amount. Definitely don't do that. Make sure any cash sitting in the SIPP is invested and keep it until you retire and need it.

Thank you JoJoSM2, it has been sat there for years. I have no idea how to invest it and never have done. I imagine that is risky since it can go down as well as up. I thought annuity would be a good idea and an extra source of income? It seems pointless it just sitting there but I have put off doing anything as I do not know what to do with it. It has increased over the years without me doing anything but not increased much in the last 12 months.

Changes were made to pensions a while back where you could now drawdown on 'certain' pensions rather than be forced to take an annuity.

For example, my defined contribution pension I 'could' take an annuity but given I would get very little each year I will opt instead to take as much as I like out each year and leave the rest invested. I have a small final salary pension which will give me X amount each year as that is a defined benefit pension so different rules.

Your old SIPP will be still be invested but stock markets fluctuate as do the funds that they are invested with.

It might be worth you getting clear advice from an IFA who can guide you through all of this.

Your old SIPP will be still be invested but stock markets fluctuate as do the funds that they are invested with.

I did presume that your funds are invested in stocks and shares and not sat in cash. Again something that an IFA could advise on to make sure they are invested in the best funds.

WhoAteMyNuts, looking at the statement..
It says Stocks and Shares ISA £0.00 for all.., stock value, cash value, total value, available.
SIPP has different amount in all those values.
Funds and Share Account £0.00 in everything as well.

It sounds like you have

A stocks and shares ISA with £0 in it.
A pension with a number of funds invested.
A funds and shares account with £0 in it.

I plan to retire in just over 10 years and decided I needed to make sure I was on track to do that given that this is earlier than my state pension age.

I paid for an IFA to get advice on my pensions. Given that what you do now can have an impact on how comfortable you will be in retirement it might be worth getting some expert advice.

WhoAteMyNuts, is that good or bad thing? Should I leave it where it is rather than take 25% and an annuity. I have been pondering this for years? Tia

Thank you yes, perhaps once I have a couple of months salary behind me I might be in a position to do so.

The thing is that the best thing to do will be different depending on your personal circumstances.

When I found an IFA they went through all of our financial history and looked at our appetite for risk as well as our ability to withstand risk and then gave us options of what to do based on that.

Investments and pensions are complex so it's helped having someone to guide me on the specifics as well as having figures to see whether I was going to be destitute or not in my old age.

As a PP has already said an annuity is a fixed monthly amount after you have taken the 25% tax free lump sum. Drawdown is different. There are a few types of drawdown. Flexi drawdown allows you to withdraw variable amounrts each year from your pension fund whilst allowing what is left to remain invested. The Gov.uk site is helpful on pensions. Sites such as Hargreaves Lansdown have pension guides. The Company that the SIPP is invested with may have helpful information on their website.

It is definitely worth investing in a workplace pension.