Stakeholder pension advice

seraphina

Hi there,

Just wondering if you guys can shed light on a good pension route for me.

I'm a PhD student who's 24 years old. I have never worked full time, other than summer jobs so I have no NI contributions. I intend to be working from when I finish my PhD (a few months) until I'm around 30, and then I will probably take off some time to have children, as we don't particularly want our children to have to go into nursery from a young age.

So my dilemma is this: I will have some gaps in my employment history when I retire and will therefore not be entitled to the full government pension (unless I make up the missed years) and will have had limited access to employer schemes, as I plan to take time out to have children. Therefore I want to have a retirement safety net and I have thought about using a stakeholder pension to do this, with the aim of paying £100/month at least when I am in full time employment. It would be paid at a similar level from my husband's salary when I am not working to ensure continuity. I would plan on opening one reasonably soon and paying a small amount into it each month (£20 or so ) until I start a full time job.

Is this a good idea? What advice can more experienced pension planners offer? Bearing in mind I don't consider myself financially savvy and although I want to take care of my money, and ensure it's working hardest for me, I don't want to be constantly monitoring shapre prices or moving money around.

Phew! A bit of a long one, thanks for reading!

EdInvestor

You would probably be better to use ISAs rather than pensions, as you are presumably going to be a basic rate taxpayer and will have no employer's pension contribution?If the latter materialises, then it's always worth paying in to get the free money.

Do not neglect your entitlement to the state pension, a valuable index linked pension which would cost a 60 year old woman 100,000 pounds to buy on the open market.

You can make up back contributiuons for up to 6 years.Women get home responsibilities contributions paid when they are at home with kids. You would be better to pay into the state pension IMHO, than a stakeholder with anything additional into an ISA.