STOP my pension, or NOT?

[Deleted User]

Hello All, after some advice or opinions again....

I pay about £50 a month into my Company Pension Scheme, they match up to 3%, so not a great deal, but again not a bad deal.

So I thought should I stop this or put it on hold and use the money to build emergency fund and repay debt.

I'm worried about my job anyway, as we have some major chances at work and I may well be without one in the future.

I also have some big bills coming up like car insurance, pet bills and I need spending money for a holiday that was already arranged a while ago.

What does everybody thing, would this be stupid or a good idea. My only concern was that I'll get used to the money and never afford to return to making my payments...

I should have said I'm 23, nearly 2 years of age.

Thanks in advance

Tixy

Just my opinion but....
Personally I would keep a pension contribution going if at all possible. Especially as your employer pays something in to it as well. I always think if you don't get those contributions from your employer you are in effect not getting a portion of your salary.

The only time I personally would consider stopping a pension would be if I couldn't afford the most basic living costs (food & mortgage/rent etc) or if it alone was the difference between keeping a clean credit file and entering a DMP or IVA and wrecking my credit file.
(or possibly if I was terminally ill and was clearly not going to live long enough to draw my pension - sorry)

Is the amount you pay in the minimum amount that means employer will contribute the maximum they offer?

[Deleted User]

I take advantage of the maximum amount that I can, to get the maximum from them, I don't pay more than the 3% as they won't match anything above this, or they won't pay what they do, I think they do more than match it to be honest.

Thanks for the advice

theoretica

As you don't pay tax on your pension contribution you would only get £40 a month if you stopped it - currently with work matching it (is £50 more or less than 3% of your monthly salary?) you are getting up to £100 pension for that £40. That level of return would be hard to match.

If you are paying more than 3% to your pension you could maybe cut down to the 3%, but I strongly advise you to keep taking advntage of all the fre money you can get out of your employer!

[Deleted User]

Thanks for the advice. I think I pay the £50, and then the pension provider claim the tax back on this for me and add this to the fund. The reason I say this is because they take the money after tax and not before :-/ - stupid thing if you ask me as I have to manually add my pension when I'm advising people of my income for example when claiming tax credits.

I have always heard mixed things about the pension and someone even told me to stop it, because I wouldn't be able to get government help when I'm older, they told me to put the money in property and do what needs to be done to get the benefit, but I am thinking that cash and property are just the same as a pension and i'll get nil benefits because of this = same situation????

Anyway thanks again, really appreciate the help.

eyeopener2

As theoretical says.

Why give up free money from your employer. You WILL retire one day, it is a long way off but it's going to happen. I know loads of people my age, late 40's who have stopped pension payments and were going to start again but never have. What are they are going to live on in less than 20 years? State pension and that will be it.

Keep investing in your future and get rid of something else. If you can, invest more.

Hopelessly_Hopeful

Hi

I wouldn't give it up, most people regret it later.

Good luck whatever you decide.

HHx

[Deleted User]

Ok well I have taken your advice, I'm going to leave it be! Although I'm not sure it was what I wanted to hear haha :-) Thanks again anyway, it's helpful to have a second opinion, when you don't have a clue what your doing lol :-/

vics199

I had a pension plan when I first started working 5 years ago. I cancelled it due to my debts and not being able to afford it as it was over £100 a month. I got all of my money back (minus tax) as I'd paid in for less than 2 years (but this must depend who your pension is with so don't rely on this). My aim was to get back into the pension scheme afer a couple of years, but 4 years after stopping it I still can't afford it and hate that fact as I do worry about having to work longer because of this to build up the number of yars of contributions

I hope to rejoin next year when I am in a better financial position.

But my point in this reply is that its a big decision and does impact on your payouts when you retire. So think long and hard and if you can afford the £50 then stay in the plan!