Penshion Scheme for 21 Year old

babydudeph

Hi,

Probably a bit of naitivity on my part, but I have never really thought about a pension plan before my first full-time job.

I am currently earning £30k pa and my employers are contributing 5% of my salary to a pension scheme of my choice. I have tried researching a few schemes but am at a total loss about what to look out for etc.

Given my age, I am prepared to take quite risk ventures with my plan (with hopes of reducing this as I age).

If there are any suggestions, I would be most grateful!

Many thanks!

atush

Well, how much do you want to research/decide? Or would you rather have someone do it for you?

Try unbiased.co.uk for a local independant FA, or try a do it your self approach (if you can put int eh time to learn) at somewhere like cavendish online or hargreaves landown.

Make a decision soonish as you are throwing away that 5% at the moment (125 a month). Be sure to contribute for yourself as well 9at least 5%) and to save outside as well for holidays, cars, life emergencies. The emergency fund should be 3-6 months salary ideally.

HappyMJ

At that age I would be saving for a house deposit rather than locking up money in a pension plan until you are in your late 60's.

jem16

HappyMJ wrote: »

At that age I would be saving for a house deposit rather than locking up money in a pension plan until you are in your late 60's.

And throw away 5%, £1500pa, free money from the company?

McKneff

HappyMJ wrote: »

At that age I would be saving for a house deposit rather than locking up money in a pension plan until you are in your late 60's.

But it may be a stipulation of the company that if they are going to contribute then he has to contribute too.

No one in their right mind is going to turn down free money.

dunstonh

No one in their right mind is going to turn down free money.

I know we wish that was true but schemes with employer contributions (i.e. free money) often have less than half the staff sign up for them). How people cannot see the benefit of free money fails me.

wadewadewade

babydudeph wrote: »

Hi,

Probably a bit of naitivity on my part, but I have never really thought about a pension plan before my first full-time job.

I am currently earning £30k pa and my employers are contributing 5% of my salary to a pension scheme of my choice. I have tried researching a few schemes but am at a total loss about what to look out for etc.

Given my age, I am prepared to take quite risk ventures with my plan (with hopes of reducing this as I age).

If there are any suggestions, I would be most grateful!

Many thanks!

V similar situation to me - my contributions are matched by my employer. We use Fidelity and they have a plan which reduces the risk (well, moves it to a "less risky" plan) as you get closer to drawing the pension

babydudeph

Thanks for the advice!

ever really thought about getting in contact with an IFA. But it seems like the wisest option given that I don't know much about the topic but I shall have a look at Fidelity as well.

Luckily my employers don't require me to contribute anything into the pension scheme, but it seems silly not to as I have a bit of savings put away already for a flat deposit within 2-3 years.

Thanks again for all your help

Nine_Lives

dunstonh wrote: »

I know we wish that was true but schemes with employer contributions (i.e. free money) often have less than half the staff sign up for them). How people cannot see the benefit of free money fails me.

A lot of people shut off from it all. They either don't or can't be bothered to sit down and crunch some numbers as to whether they'll be able to afford to contribute SOMETHING. They just hear that some money is going out of their wage & they panic saying they can't afford it, without considering that they MAY be able to afford it.
Then there'll be those that live for today. Why put something away today that you can piddle down a drain tomorrow, which is much more fun </sarcasm>.
Also those who hear the word "pensions" & say hell no, that's too complicated for me, i can't be bothered.

Unfortunately i feel the "can't be bothered" 'craze' is spreading. People can't be bothered to do anything these days.

snowcat53

One can easily get bogged down unnecessarily. Alternatively you can take it one step at a time and start with a simple low cost tracker fund that follows a share index (such as FTSE All share) inside a pension wrapper. I know about L&G who I am pretty happy with - good online system with vaulations, easy switching. (Tip - if you are a shareholder you get a discount on the annual management fee).

As you get more knowledgeable you can switch funds if you wish, or go to an IFA for advice. But good idea to just get started.

webnibbler

snowcat53 wrote: »

Alternatively you can take it one step at a time and start with a simple low cost tracker fund that follows a share index (such as FTSE All share) inside a pension wrapper.

Completely agree. A SIPP from an online platform with a set of low-cost trackers is a great place to start. I particularly like Vanguard’s LifeStrategy funds for absolutely no effort investing, without doubt the best choice IMHO out there right now for novice investors.