Pension contributions

[bonzaitree]

Hi all,

Just wondered what percentage you pay into your pension? Would also be useful to know your age for context and whether you work in public or private sector.

I've just moved jobs so have to make a decision. I work in the private sector and my employer contributes 5%.

I am a saver so want to add a lot more into my pension, but we are saving for a new home deposit at the moment so just trying to balance it out.

I am early 30s.

@BooksAndChooks well some do. You are just choosing not to.

I might be picking you up wrong, but are you saying that I could find an apprenticeship that would pay me what I make now but I'm deciding not to?

I would genuinely like links to these very well paid apprenticeships that require no drop in wage.

@BooksAndChooks no of course not but I'm saying many people do drop wages temporarily to retrain for another career which longer term may offer them more benefits. If you can't, or won't. I'm saying that's your choice. If you have chosen to go into a career you find well paid but unfulfilling with a poor pension then you made that decision and to reverse that you will now need to make some sacrifices. That's life!

But it isn't a choice. Some people are "trapped" by their circumstances. They literally can't afford to drop their wages or maybe they have caring responsibilities and so can't take on the hours required to complete an apprenticeship. That isn't a choice, that's life.

I am very fulfilled by my job, I love it. I just think it's totally unrealistic to think that everyone can just do an apprenticeship or find an equivalent public sector job. I would love for it to be the case, but for lots of people it just isn't practically possible.

@BooksAndChooks we agree to differ. I see people every single week with young children and responsibilities as a mother starting a nursing career. It's incredibly hard, many don't make it but some do.

I'm not saying it isn't possible for anyone, of course some people do it, but it isn't practically possible for everyone.

Public 7.5

@BooksAndChooks nothings practical for everyone!

But public sector workers saying things like "just work in the public sector then!" heavily implies that this is a viable option for all. All I was saying is that this well trotted out line isn't realistic for many.

Yep, I get stung with the cap that you mention. It’s rubbish.

I think it’s pretty typical of my sector (tech) but I think salaries are generally higher so I guess it evens out. That’s what I tell myself anyway!

The public sector is a major employer in pretty much every town, so I imagine it is a viable option for most. If they are prepared to comprise on lower pay and probably also accept they will be doing the work that should be done by several people.

A vast range of professions/skill sets are represented just in the organisation I work for. And I imagine across the public sector as a whole it is even broader.

What I'm saying is some people can't compromise on pay.

I work in a skilled role and earn to reflect this. The public sector doesn't have my role in Northern Ireland, they do in some of the rest of the UK.

So my options for "just work in the public sector" would be to move to England/Scotland/Wales and away from my v cheap childcare (financially not viable) or look for some sort of entry level public sector job here which again isn't financially viable.

The public sector around where I live is mostly admin or skilled jobs that I would need to retrain for (not financially viable).

I'm not necessarily complaining about this, it's like this in lots of more rural and less developed places around the UK and I do like my job. I'm just pointing out that we can't all just work in the public sector.

Of course we can't, but equally everyone is free to choose to. We all make decisions balancing a range of factors -.pay, pension, location etc.

If public sector workers overall packages were so astonishingly unfairly brilliant we'd have people falling over themselves to work for us, and we don't.

The decent pensions are set against a lot of other factors

@Mazuslongtoenail Yes, I'm in an adjacent sector and I imagine I earn a lot more than I could in the public sector, which is helpful for things like getting a mortgage against salary etc but you do have to get used to mentally downsizing your actual salary in your mind when you realise how much of it you'll have to put straight into a pension...

It is totally impractical if not almost impossible for some people to work in the public sector for reasons I've already outlined.

I'm not arguing whether or not the pensions are fair, just that the "gotcha!" line of "go and work in the public service then" isn't a realistic possibility across the board.

I'd say it applies to the vast majority of the population.

I've advertised a series of public sector jobs (professional roles),.in a highly accessible location with easy public transport and free parking , this year. I've had a handful of applications for each. If the package (salary and pension) was that enviable you'd expect vast piles of applications.

So perhaps we can all accept that the pension is a good perk of the job but balanced against salary etc it is not the obscene waste of taxpayers money some like to pretend (I mean, my organisation only gets 5% of it's income from tax anyway)

Private sector employers are totally free to offer similar packages to employees...

Ideally you would want to know how many applicants the equivalent private sector job roles got if advertised at exactly the same time, same place etc otherwise there are too many variables to draw any firm conclusions.

I don't want to get drawn into whether or not the pension is fair but i do agree that public sector jobs (and indeed all jobs) need to be viewed as a whole package including job security, pension, holidays, career progression and support for further training and so on.

My private sector one is 4% employer and min. 3% employee, but they will match another 1% so I get 5% employer and I pay 7%. So 12% in total.

What I find confusing is the charges though. My previous pension was public sector but partially DC/DB as the final salary scheme had closed by the time I started the job. But I've noticed I seem to be paying far higher charges to the pension company for my new scheme. Eg my fund has grown by £180 in two years but the charges are over £80 for the same period.

I do think there's a ticking time bomb developing. Future pensions will be nowhere enough to live on, many people forced to privately rent into retirement as they can't afford to buy and suddenly loads of older people whose pension income isn't enough to remain housed.

I don't disagree. The point is some people are acting like public sector pensions are some kind of outrageous fleecing of the tax payer, when really if the overall employment package was that outrageous people would be queuing on their thousands for a job.

It's an ok package for most, and a pragmatic one for the govt (as at least most public sector workers won't need benefits in old age) but it's absolutely not the outrageous scam some are making it out to be.

I don't think anecdata is particularly relevant but I could easily earn double or triple in the private sector and so could all my team. We do it because we are civic minded and like the flexible working (although flexibility is balanced by long hours and crazy stress due to... Struggling to recruit to vacancies...)

35-45% of gross in recent years.
Up until recently wasn't anywhere close to this though.
I'm a bit behind overall, so once the mortgage was sorted, now actively using AVCs to try and catch up.

Public Sector - I put in 5.5%, my employer 27%. 25 year's membership so far.

@Hitchens

I think that is a poor argument. It's not a race to the bottom. I believe I am allowed to object to something. I'm not keen on many things the Government does. I'd prefer it if they spent money in better ways. I'm not keen on HS2 and think they'd be better off spending the money on our war veterans. I could list 50+ things I'd prefer they spent money on.

If I object to the fact the pensions being paid now are too much and also unsustainable I'm accused of hating nurses by a pp. I'm told to take such a job myself. But I don't want to thanks. I'm happy in my job, I've increased my pension contributions thanks. But apparently I'm not allowed to object to anything. The only answer is to get such a job myself. But I don't wish to. So thus, this now means I'm not allowed to believe that something isn't right?

The government announced that the pension annual allowance would be increasing for the 2023/24 tax year to £60,000 per tax year or up to 100% of your annual earnings if this is lower than £60,000. The annual allowance includes your personal contributions, employer contributions and tax relief.

Yeah, let’s cut nurses’ pensions to appease the gammons.

That won’t have a negative impact on retention and public services, will it 🙄

Seems a bit daft and short sighted to reduce public sector pensions and then those employees instead claim benefits in old age. Plus a sure fire way to ensure a brain drain from the public sector.