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  • FIRST POST
    • Fireflyaway
    • By Fireflyaway 11th Oct 17, 4:14 PM
    • 1,355Posts
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    Fireflyaway
    Basic question...
    • #1
    • 11th Oct 17, 4:14 PM
    Basic question... 11th Oct 17 at 4:14 PM
    I'm starting a new job next week where the employer makes a 6.5% pension contribution. Does that mean they deduct from my advertised salary so in essence I have less take home pay? I assume its not in addition to salary? I'm new to all this!
Page 1
    • soulsaver
    • By soulsaver 11th Oct 17, 4:16 PM
    • 1,489 Posts
    • 536 Thanks
    soulsaver
    • #2
    • 11th Oct 17, 4:16 PM
    • #2
    • 11th Oct 17, 4:16 PM
    Your contribution comes out of your salary, their's is in addition to salary.
    • Fireflyaway
    • By Fireflyaway 11th Oct 17, 4:22 PM
    • 1,355 Posts
    • 1,372 Thanks
    Fireflyaway
    • #3
    • 11th Oct 17, 4:22 PM
    • #3
    • 11th Oct 17, 4:22 PM
    So I get paid x and the 6.5% of x on top is put in a pension? That's great, I assumed it came from my pay.
    • MallyGirl
    • By MallyGirl 11th Oct 17, 4:45 PM
    • 2,095 Posts
    • 6,962 Thanks
    MallyGirl
    • #4
    • 11th Oct 17, 4:45 PM
    • #4
    • 11th Oct 17, 4:45 PM
    the employer will pay in from their own coffers but you may need to make your own contribution in order to get this - worth every penny
    • AnotherJoe
    • By AnotherJoe 11th Oct 17, 6:55 PM
    • 7,671 Posts
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    AnotherJoe
    • #5
    • 11th Oct 17, 6:55 PM
    • #5
    • 11th Oct 17, 6:55 PM
    If the employer makes a contribution that should mean everything exactly what it says, the employer makes the contribution.
    As said, check if you also need to make a contribution. You should, 6.5% from the employer is very good but it isn’t enough.
    • Fireflyaway
    • By Fireflyaway 11th Oct 17, 7:27 PM
    • 1,355 Posts
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    Fireflyaway
    • #6
    • 11th Oct 17, 7:27 PM
    • #6
    • 11th Oct 17, 7:27 PM
    This is great news. Is there a standard amount to aim for? Should I top it to make 8% or 10% etc? I suppose the more the better but is there a rule of thumb?
    • AnotherJoe
    • By AnotherJoe 11th Oct 17, 8:50 PM
    • 7,671 Posts
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    AnotherJoe
    • #7
    • 11th Oct 17, 8:50 PM
    • #7
    • 11th Oct 17, 8:50 PM
    Yes, there is as it happens a rule of thumb. Seriously.

    Take your age when you start contributing to a pension.
    Halve it.
    Save that percentage going forward.

    So, if you start a pension age 30, then contrbute 15% . That % stays constant. 15% aged 40, aged 50 etc
    Or, if you start a pension aged 40, you’d need to save 20% going forward.

    That % can come from you, you employer, or a mix, it doesn’t matter.
    The other “rule”is always to pay in enough to get a matching employer contribution, if that’s what they do (yours may not)
    For example,,let’s say your employer will match you % for % up to 6.5%.
    . You pay in 2% employer puts in 2%, you pay in 6.5% employer 6.5%, you pay in 10% employer pays in 6.5%, eg that’s the ceiling. In that case, 6.5 should be your absolute minimum otherwise you are throwing away free money.
    HTH

    Ps congrats on the new job!
    Last edited by AnotherJoe; 11-10-2017 at 8:57 PM.
    • Kernel Sanders
    • By Kernel Sanders 11th Oct 17, 10:19 PM
    • 3,193 Posts
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    Kernel Sanders
    • #8
    • 11th Oct 17, 10:19 PM
    • #8
    • 11th Oct 17, 10:19 PM
    You should, 6.5% from the employer is very good but it isn’t enough.
    Originally posted by AnotherJoe
    It's far too much, in fact it should be zero, and Employers' NI should also be abolished. Welfare should come from the state (to which employers usually pay corporation tax when profitable).
    #JeSuisCharlie
    • AnotherJoe
    • By AnotherJoe 11th Oct 17, 10:38 PM
    • 7,671 Posts
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    AnotherJoe
    • #9
    • 11th Oct 17, 10:38 PM
    • #9
    • 11th Oct 17, 10:38 PM
    Anyone got some troll food ?
    Hmm, on reflection, don’t feed.
    • bigadaj
    • By bigadaj 12th Oct 17, 4:15 AM
    • 10,803 Posts
    • 7,100 Thanks
    bigadaj
    It's far too much, in fact it should be zero, and Employers' NI should also be abolished. Welfare should come from the state (to which employers usually pay corporation tax when profitable).
    Originally posted by Kernel Sanders
    Have we had a little drink or three, though maybe it's just railing against the world if you live in Mansfield, understandable really.
    • Dansmam
    • By Dansmam 12th Oct 17, 8:07 AM
    • 534 Posts
    • 1,816 Thanks
    Dansmam
    Hey, it’s a point of view. Just not one that’s been popular recently.
    Retreats back to lurkdom and awaits flamethrowers ...
    • bigadaj
    • By bigadaj 12th Oct 17, 8:13 AM
    • 10,803 Posts
    • 7,100 Thanks
    bigadaj
    Hey, itís a point of view. Just not one thatís been popular recently.
    Retreats back to lurkdom and awaits flamethrowers ...
    Originally posted by Dansmam
    So what's the benefit of that approach?

    Particularly as the statement that companies pay corporation tax is a little last century to say the least.
    • Clifford_Pope
    • By Clifford_Pope 12th Oct 17, 8:14 AM
    • 3,411 Posts
    • 3,501 Thanks
    Clifford_Pope
    Hey, itís a point of view...
    Originally posted by Dansmam

    It is, but it's not relevant in a thread seeking advice relating to an individual operating in the present pension provision framework.

    It would be an interesting viewpoint in a different thread in a different forum on the subject of the role of the state versus private self-responsibility.
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