Married - should we invest more in high earner DH's pension?

[PooWillyNameChange]

Hi there,

DH and I have been together about 8 years, married nearly 5 of those. Very happily married but I know from MN anything can happen!

Right now we both salary sacrifice to get employer match and then, because his income is so much higher than mine, we put a further £300 a month into a SIPP in my name so he doesn't end up with a huge pension and me a tiny one. However, I am a basic rate tax payer and he is well into the 40% bracket. Should we instead funnel the extra into his on the assumption that should we split I will be entitled to a share of his, to take advantage of the double uplift compared to mine?

DH not that interested in money/finances and happy for me to do whatever I think is best. His parents have been very happily married for 35 years so in his rose tinted world divorce doesn't happen.

@Capferret

Agree with *@bowlingalleyblues*. Also as men statistically die sooner you could see your income halve on his death when you need the money most.

^ just utter fucking crap.

If your husbands dies young you not only get the pension in full but it’s then tax free.

Why do people comment when they know fuck all on a topic?

@Amberflames

I'm on £40k a year whereas DH is six figs

OP it’s worth thinking about whether he will reach the level where the tax free allowance starts to taper. I reached it well before I got close to the maximum pot size and am now restricted to £10k a year tax free.

@Amberflames well it actually dropped to £4K when the level of the taper start point went over £240k (£4K at the end which is over £312k)… you might not be impacted now.

@Dindundundundeeer well I hope you're right.
My dh is a retired civil servant and I read all his pension paperwork and understood that on his death I would only get half.

@Dindundundundeeer just read it again.
On his death I get half his pension.

@Capferret

Not all pensions schemes are the same. Your husband is probably in a defined benefit scheme. The OP has said her husband is in a defined contribution scheme. They work very differently.

[quote Capferret]@Dindundundundeeer just read it again.
On his death I get half his pension.[/quote]
That’s the details for one pension scheme.
You can’t post that as a general fact!
Sounds like CSP - which as the pp says, is a DB scheme with totally different rules than a DC scheme - and indeed can be totally different to another DB scheme.

Depends on how much he earns if it's over 100k he will lose some tax relief anyway. If the total contributions (his and employers) are over £4K in a year, then he will have to repay the tax relief if he earns over 100 or 150k (can't remember specific amount!)

I had a call with my financial advisor on this just yesterday.

Forgot to add, it's fiendishly complex on higher rate taxpayer circumstances, so get FA advice

[quote Capferret]@Dindundundundeeer just read it again.
On his death I get half his pension.[/quote]
Yes but the type of pension you are talking about and the ONLY type OP can be discussing are about as different as apples and toilet paper.

When comments are made and they are left on a site people read them and it's the 'but the man down the pub said'.

I spend my time listening to bollocks that 'man' has said, so sorry if it was harsh, but it drives me mad!

@ablutiions I think your FA needs to do some CPD

There are of course instances where a DC pension can no longer be passed on such as when an annuity has been taken out (I know there are some mitigating options but they cost more money).

What's CPD?

Too
Many
TLAs !

Continuing Professional Development

Depends on how much he earns if it's over 100k he will lose some tax relief anyway. If the total contributions (his and employers) are over £4K in a year, then he will have to repay the tax relief if he earns over 100 or 150k (can't remember specific amount!)

@ablutiions I don’t think this is true?!? Unless you mean over £40K not £4K but that applies to everyone?

Or are you thinking of the loss of personal allowance for earners of around that range maybe?

@ablutiions

Depends on how much he earns if it's over 100k he will lose some tax relief anyway. If the total contributions (his and employers) are over £4K in a year, then he will have to repay the tax relief if he earns over 100 or 150k (can't remember specific amount!)

I had a call with my financial advisor on this just yesterday.

Well either you or he had some glue before that call You are so wrong I can’t even begin.

I suspect you got the wrong end of the stick. Call again

FWIW the £4K kicks in at £312k and even then the mechanism of payment is NOT as you describe.

Actually I should say £4K is reached, not kicks in, but hey ho accuracy appears irrelevant

@Dindundundundeeer it could well have been meds on my part to be fair. I will get some further clarification.

[quote ablutiions]@Dindundundundeeer it could well have been meds on my part to be fair. I will get some further clarification. [/quote]
Strong meds.

Hopefully nothing that can’t be sorted.