ISAs v Pensions: The Official Retirement Debate

atush

And of course you can't get tax relief on your ISA contribs, so have to put in more each month.

fairleads

dunstonh wrote: »

You can do that with pensions if you want.

Not to the same extent that you can with an isa though.

Thrugelmir

fairleads wrote: »

Not to the same extent that you can with an isa though.

FTSE 100 is around 23% off its 1999 peak high. So you need to take what ever you can to boost the return.

Andy_L

atush wrote: »

And of course you can't get tax relief on your ISA contribs, so have to put in more each month.

However you don't pay tax when taking income from the ISA so its swings & roundabouts

fairleads

dunstonh wrote: »

What is non-representational about it?

The post by hyleHP04 said "its much easier to add a bit more one month and a bit less on others and monitor the progress". I said you can do that with pensions. Which is correct. So, what is wrong with that?

The OP allued to the fact that the Isa is a more flexible wrapper than a pension thus they provide more options. [text removed by MSE Forum Team] Interesting is that while some pension contributions can be varied at will, it might not apply to all pension contracts to the extent you imply.

atush

Andy_L wrote: »

However you don't pay tax when taking income from the ISA so its swings & roundabouts

Not really, as you also can take a 25% lump sum with a pension. I think that, and the basic rate uplift will more than compensate. Bit I do recommend having both for hte best retirement planning. In either case though, taking income after retirement could mean a lower rate of taxation.

atush

The liquidity of an ISA also means that in emergencies it would prevent you from claiming means tested benefits while pensions would not.

You should have emergency savings always, and cash ISAs are a good place for it. But I thought we were speaking on non cash equity investments.

fleurh

This report by the CPS

http://www.cps.org.uk/publications/reports/put-the-saver-first-abridged/

makes interesting reading.

Several industry commentators have reviewed it, their comments can be found here:

http://www.thisismoney.co.uk/money/pensions/article-2159798/Radical-ideas-Super-Isas-shake-pension-saving-spark-industry-backlash.html?ITO=1490

http://moneyfacts.co.uk/news/savings/put-savers-first-urges-think-tank15612/

I personally love my ISAs for their flexibility and although I've got a reasonable set of pensions taken together, several rounds of redundancy mean I've also got quite a healthy savings pot squirrelled away in tax-free ISA havens. I haven't looked too hard into what will happen when I retire in 10 or so years time, so it's good to read about fresh ideas for the industry.

Paul_Herring

fleurh wrote: »

http://www.thisismoney.co.uk/money/pensions/article-2159798/Radical-ideas-Super-Isas-shake-pension-saving-spark-industry-backlash.html?ITO=1490

Mail wrote:

Financial industry supremos unleashed a barrage of criticism of the Put Savers First study from the Centre for Policy Studies

He seems to have hit a nerve...

Withergee

I have saved in pensions all my life and in recent yearstaken out ISAs plus other investments as well as saving cash, all in readinessfor retirement.

I was going to look at annuity rates but I was introduced toDraw Down Pension, which are completely new to me.

Supposing I have a retirement fund of £200k (which I haven’t)and the draw down gives me a pension of £1000 per month. Because of the needfor transparency, my IFA tells me they are wanting 0.5% per month to look afterthe fund. This means they will earn an equivalent amount to me.

Am I being naïve in thinking I could set this up myself andso avoid the 0.5% fee, thus receiving a pension of £2000 per month from thefund, or would “hidden” fund chargesmaterialise elsewhere before I receive my pension, giving me the £1000 permonth anyway?

I do understand the IFA will provide me services for the 0.5%,services I won’t receive if I set up the fund and subsequently monitor itmyself, which if I am honest, I probably couldn’t do effectively.
Any comments please