Probably one for an IFA but...

moomintroll_3

... thought I might as well ask here as well.

I'm about to take a new job which offers a contributary occupational pension with contributions from me of 3% and from the company of another 3% therefore making 6% of my gross salary.

I also have a rag-bag of old pensions with next to nothing in (a couple of thousand here, a few hundred there) which I should make some effort to consolidate.

I'm 35 so know I should be making more contribution toward old-age than I currently am doing but I mistrust pensions after all the scandals and, of course, Brown's raid on the funds.

Another issue is that I fully intend to emigrate to Canada in the next few years (my wife is Canadian) for hopefully an increased quality of life for my family.

I guess my question is, is it worth contributing to a new pension given that the company make the same contribution or would I be better opting-out and sticking the money I would be putting toward the pension into an ISA or some other savings account (my wife is a non tax-payer) given that we are likely to flee the country in the relatively near future?

I'm a basic-rate tax payer but likely to receive bonuses that will possibly tip me over the edge into the higher-rate band.

Any opinions gratefully received.

Cheers,
G

Cook_County

As your wife is domiciled outside of the UK you should be utilising this status to invest tax-free offshore.

You can then compare the lump sum that would result from tax-free growth offshore to the net of Canadian tax pensions you can expect to receive in retirement from the UK pension plan you might invest in.

That is the theory, but ultimately the decision of a bird in the hand now as against in retirement age may be want you want.

You will of course want to investigate State pension entitlements when in Canada. I do not believe that it is possible to roll a UK pension plan to an RRSP, but this should also be checked.