New job but no company pension - what to do?!

hertfordian_2

Hi all -

Sorry - this is a bit of a long question - but please bear with me.

I've just started a new private sector job after having worked in the public and quasi-public sector for the past 14.5 years. I have 4 years' worth of pension through the quasi-public sector work and some 11 years' worth of local government pension - both of these I'm intending to keep.

I also have several private pension type vehicles from working prior to 1997 - specifically, a Clerical Medical Stakeholder Pension (Stakeholder Plan 2001), a Standard Life Pension Plan and free-standing AVC Plan. In total, these last three account for some £11000 but have been frozen for a number of years).

In my new role, I went through the process of applying to join their pension scheme but have found out that employees can only join if they are earning about £40K (I'm on £37K) or if they are within 5 years of retirement. I therefore need to look at making my own provision for the time being.

Given what I've outlined above, can anyone advise on what should be my next course of action? i.e.:

• Do I re-start paying into the existing private vehicles listed above
• Do I look to start a brand new pension and if so, can anyone advise on what
• Do I look at some other route - e.g. consulting an independent financial advisor etc.

Any guidance/advice would be much appreciated :-)

Thanks in advance

Ian

atush

First of all, even if your salary doesn't get up to 40K, they will have to let you join their penion soon (by the end of 2016) as the law is changing.

But in the meantime you can pay into an old one, or start up a new one. We don't know anything about your old ones so we can't say. You need to investigate them thoroughly incl the charges, the funds available for investment etc. And compare that with a new plan.

For new, you have to decide if you are going to go to an IFA (how much per month would you be putting in?) or DIY thru a platform or SIPP. The charges for newer pensions are quite likely to be lower in many cases. And personal pensions will have more funds available the invest in than Stakeh9oler ones overall. And Sipps have even more types of things you can invest in.

So, the choice is yours. Get otu all your old pension state,ents and start researching.

xylophone

Wasn't it one of the features of a stakeholder that you could stop and start?

atush

I think so, but don't know how old the OPs ones are and the charges and funds? That to me would be more important than ease of restarting. Having said that inertia is high when it comes to financial matters.

hertfordian_2

Thanks all for your invaluable responses.

I was unaware of the legislative change stating that all companies will have to have a pension scheme in place by 2016. I've noticed that the largest ones will have to have one in place first starting in October 2012. Given that I work for a large services company employing some 48000 staff, I would guess I should be being offered a pension in the next 12 months. (I've written to their pension team asking them to confirm when such a scheme will be being offered)

In the meantime, I am therefore thinking I may simply top up one of my existing schemes until such time as the new pension scheme is available.

Ian

jamesd

You're not a higher rate tax payer so you might well be better off using payments into a stocks and shares ISA for a few years until you're again in an efficient pension scheme. You can switch the money into a pension than if you like.

The advantage of the ISA is flexibility and it's particularly handy if you want to retire early because you can draw on the capital at whatever rate you need to keep your income level up until the pensions start.