Pensions- can I contribute when not working

Skidoobee

Apologies for a very basic question but I'm 50 in Sept and trying to sort some things out.

It's highly unlikely I'll ever return to salaried employment in the future. I may have some income due to self employment in time, but that'll be down the line.

Over the years I've collected a number of pension schemes a couple of which I'm going to take the benefits from in September. I've a couple of small ones though that are hardly worth winding up. Something at the back of mind also says it's worth keeping one going, despite my plummeting confidence in the pensions/financial market [another issue, sorry lol].

I just need to clarify whether I can continue to contribute to a pension despite not presently having much of an income [the two schemes I'm considering are 'ordinary' personal pensions]. Essentially I see it in my present situation as another form of saving with added tax benefits. Or is that too good to be true?

As always advice much appreciated from you lovely peeps :T

shaunrc

Hi

Yes as long as you are resident in the UK you can pay in up to £3600 per annum in gross terms into a pension scheme regardless of your earnings level.

As to whether it is a good idea you will find lots of views on here. A big issue would be if you feel you might want access to the money which would perhaps point to an ISA or if you dont then the extra tax advantages of a pension might point you towards it.

In simple terms you are choosing between the 25% tax free cash a pension offers and full access to your money which an ISA gives you.
Also remember that from the next tax year you can only take a pension from 55 not 50.

I hope this helps....

Skidoobee

Thanks for clarifying that Shaun- i'm looking at Isas as well- I'm thinking that a spread of options of modest amounts may be better than putting all your financial eggs in one basket for the foreseeable future, so it looks like I might as well keep a personal pension ticking over.