New to pensions - just got a Teacher's pension

VickyA_2

Hi there,

I'm 27 and started my first "proper" teaching job in January. With that came automatic membership/payment into the Teachers' Pension Scheme. This is my first pension. I'm worried that as I've started quite late (it seems), I need to make other provisions for my retirement.

£97 is currently taken straight out of my salary each month, which equates to approx 6% (this is what it says on my pay slip). Current salary is £19,161..... to be precise.

What can I be doing to improve my retirement fund? Where do I start? What is there out there? Is there a guide to pensions for dummies?

Thanks in advance
Vicky

PS I don't currently own a house, but we're hoping to buy one in the next year. Not sure whether this makes a difference?

EdInvestor

VickyA wrote:

PS I don't currently own a house, but we're hoping to buy one in the next year. Not sure whether this makes a difference?

Well yes.:)

You're already in one of the best pensions in the land, so no need to worry about that.Not a good idea if you're saving for a house to lock up money in another pension, as you can't get it out.

If you're not saving, but want to start accumulating more for your old age, try an ISA instead. You can invest in the same things as a pension in a stocks and shares ISA, but it's a much more flexible tax wrapper.

It's also a "use it or lose it" annual allowance, whereas the new pensions rules enable you to put in large lump sums much later in life and get tax relief.So there's no rush with them, use the ISA instead.

VickyA_2

I already have some mini cash ISAs, but haven't used this year's allowance yet. I'll look into the stocks and shares ISA................ :eek: It's all scary stuff!

Edited to say: Many thanks for the quick response!

KMK

Yes, Vicky, you are lucky to have the opportunity of a final salary scheme which is rapidly becoming very rare elsewhere. In fact, many teaching assistants and school support staff have been on strike to get similar pension arrangements to yours. It really is a good scheme! You might want to add to it in other ways later in your career. Good luck with the job!

jem16

With the teachers' scheme you have the option of buying back added years and these will count towards your pensionable service. However they can be quite expensive if you buy them later in your teaching career so the sooner you can do this the better.