30 - what to do with my pension?

stevie_wonder

Hi all,

I'm frequently on this site but this is my first venture onto the pensions board. I think I'm quite clued up with my finances, but pensions is the one thing I've never really understood fully so I'm looking for advice or comments on my situation please?:rolleyes:

From May 1999 to Jan 2006 I paid into a group personal pension scheme (Legal and General) and my employer contributed too. I moved job in February 2006 and the new company doesn't run a similar scheme. As I was buying a house, and about to become a dad for the second time, I decided (wisely or not) to stop paying into the pension and see if my situation was better in 6/12 months time (BTW I could have afforded to continue to pay but didnt).

The statement I got in Feb 2006 gave the fund a value of £19,601, with my regular contributions over the previous 12 months being £1671.12 (£139.26) and employers £825 (£68.75 p/m).

I'm now 12 months down the line and feel I should be looking at this again, but I'm unsure which way to go.

I could do three things, i think:

-continue the pension I already have
-start a new one (although I dont see the benefit of that)
-forget about it and invest in something else altogether

I'm thinking I'll continue with the one I've got, but aren't sure about how much I should be contributing? Should I put in the equivalent amount that me and the employer put in - £139 + £68 or should I put double that , as I've missed paying for a year? I also have a large lump sum £26k and could invest some of that in the pension. If it helps to explain my situation, I'm on £28k base salary and regular commission takes it up to £40-42k in the year.

EdInvestor

Assuming the charges and fund choice are reasonable on the existing pension, you could consider contributing enough to soak up the chunk of your salary in the high rate tax band.

I wouldn't put in more than that though, better to max out your investment ISA in preference as it's a "use it or lose it" perk.