Signed uo for a pension - Have i done right thing?

dewmass

First post on here but have been lurking for ever! I hope this isn't too long or boring but having ready many threads I've seen that the experts like as much info as possible.

I'm 29 years old and finally decided to start a pension. My IFA recomended a Scottish Life pension plan and opting out of SP2. I decided on a pension because I don't trust myself with money in ISAs so its probably the best move for me. I'm just slighlty concerned that I have overstretched myself in terms of how much I'm going to put in each month, so hopefully someone can put me at ease. I work in sales so my income is extremely volatile, last year I finished with £39500, the year before £32000. I have gone for £200 from me with the 22% on top of that. Since the start of January I had settled on paying off the mortgage quickly in order to move up the ladder - £4000 this year with mortgage down to £61500 now. Unfortunately, cash only goes so far and with all these balls to juggle I'll not be able to afford beer, would it be finacially better for me to carry on with overpayments and lower my pension payment?

Lastly, the IFA has put 40% of the pension spread into commercial property, having read a lot this seems way too high. Or am I wrong on that too?

dunstonh

Scot Life are a good pensions provider. Their personal pension can actually be cheaper than stakeholder and still allow some external funds to be selected. I have used them myself for clients a fair bit for the last few years. They have a good fund range and have recently added more and show signs of devloping the contract to keep it modern rather than leave it the same.

40% into property is fine for a cautious individual.

EdInvestor

IMHO the property fund should be the first port of call when investing a private pension.This is because almost all insurance companies have well-run property funds which have a long history of stable returns.These funds are not available in ISAs. By contrast, you can get access usually to better quality equity funds in ISAs.

dunstonh

These funds are not available in ISAs.

Property funds were available to be included in ISAs from 29th December 2005 with most of the major insurance companies offering their version in the ISA. However, the unit trust version (which the ISA would use) tends to have higher charges than the stakeholder version or personal pension version

EdInvestor

....with most of the major insurance companies offering their version in the ISA

Really, and where can we find a list of these?

dunstonh

I don't know where you could get a list. My information is sourced for IFAs and not available direct to public. Morningstar have hardly any of the property funds in their feed and trustnet are not much better.

Some that come to mind straight away are Standard Life, Norwich Union, Legal & General. Others include Resolution (ex Britannic), New Star, M&G, Morley. These sometimes appear on personal pensions rather than stakeholders.

dewmass

Cheers for the replies, I feel better now. I'm one of those people who are wary of IFAs but thats due to the fact I sell cars I suppose!

EdInvestor

Property funds for pensions -153


Property funds for ISAs - 11

You can see what I mean

dunstonh

Thanks Ed, although there are quite a few missing from that list. Its about time Trustnet and morningstar treated property funds like the rest of the funds