Possible change of job and new pension

MJS996

Hello all

Forgive my ignorance, but as clued up on money matters as I am, pensions is not one of the things I know anything about as I currently don't have one (several properties on a long term basis is my way forward, may not be the best solution anymore, but that's not what this is about)

So, the situation is this. I have an attractive job offer open to me which includes an option to join the company pension scheme. I'm 39, so I if I stayed for life I could easily pay in for 20-25 years.

What do I need to look for (it's not final salary, I know that), what would make it worth joining? Any guidance, or any advice on who I could speak to for guidance would be appreciated.

Cheers
Martin

dunstonh

(several properties on a long term basis is my way forward

It is estimated that you need about 8 properties for retirement planning.

I currently don't have one

At 39 that is leaving it late but pensions are just one of the options for retirement planning. As long as you have other assets available (which are not leveraged) and there is sufficent value there then you should be fine. Ideally you would be looking for somewhere around the £35-40k mark as an average by now.

what would make it worth joining?

employer contributions. Effectively free money

or any advice on who I could speak to for guidance would be appreciated.

Any IFA

MJS996

dunstonh wrote: »

It is estimated that you need about 8 properties for retirement planning.

At 39 that is leaving it late but pensions are just one of the options for retirement planning. As long as you have other assets available (which are not leveraged) and there is sufficent value there then you should be fine. Ideally you would be looking for somewhere around the £35-40k mark as an average by now.

employer contributions. Effectively free money

Any IFA

Yes, appreciate I have been somewhat remiss in not organising something sooner. I ran a Ltd Co and had an Executive Pension but got divorced and ditched it when my ex tried to go after it. After that, I settled on the property line, which fortunately were all purchased a good few years back so I'm in reasonable shape with those. Also have around £40k in savings, so fairly comfortable with things.
So, if the employer makes contributions, and obviously the bigger the better, would 20 years give me time to actually make it worth while - or are pensions totally shot now?

dunstonh

or are pensions totally shot now?

Pensions are not shot. The media loves having a go but what you read is mostly incorrect, rubbish or spun in a way that makes it sound like all pensions when its just a minority.

A money purchase pension is just a tax wrapper. It doesnt make money, it doesnt lose money. You place investments into the tax wrapper and its the investments that give the returns. If you held the investment unwrapped, in an ISA, in an investment bond or whatever, the return would be indentical apart from the tax.

So, when you hear people saying pensions are rubbish, they really dont have a clue what they are talking about.

An analogy to that would be like saying which is fastest, a ferrari or a smart car? Both could be. Put water in the fuel tank of the ferrari and it goes nowhere and the smart car would be faster. In your case, you have property. So, you know what can happen if you buy a duff property, over the odds with no potential. You dont say buying property is bad based on that.

If you work on the basis of the 5% rule in that whatever capital you have, multiply it by 5% and that is the income potential. So, when you know what you want to earn in retirement, work it back from 5% and thats the capital you need (capital could be property with a rental yield).