What to do with 10,000

bowlhead99

atush wrote: »

if they are in the 40% tax band, how are they paying only 30 quid a week? I thought the railway was a DB/FS scheme?

Am I dreaming here?

the OP should def be paying more pension contribs (even if into a Sipp or PP) at 40% tax until they drop out of the higher tax band. Unless of course, buying a house is now or in the near future on the cards.
Quite frankly, I am confused by the numbers here.

I've no idea the rules of that scheme but say they were on ~40k and had to contribute 6% of salary, that would be 2400 a year or 46 a week, which hits your take-home pay by 27.60 a week. Or the maths is similar at 5% of a 50k salary. Presumably they're not on 100k at that age. So the maths is not outrageous, although of course maybe they just mis-remembered the figures.

If it's not a final salary pension and the amount mentioned is the gross, I'd suggest putting more in over time. But with zero other savings, and no house etc you should focus on building up a good emergency fund for your life now rather than locking it away until 55.

Once this particular 10k is in a nice safe cash ISA (and savings account or high interest current account for the amount that won't fit in the cash ISA) you'll have a buffer to fall back on, so Jamesd's advice to start putting away some of your future income into S&S ISAs is sound as a general life plan. Of course if getting on the property ladder in a couple of years is wanted, you'd want to have more of those future savings going into cash rather than investments because of the risks, but if a home buy is a long way out - like 5-10 years or more (or never), you'd want more towards investments.

[yay, 500 posts!]

ColdIron

bowlhead99 wrote: »

[yay, 500 posts!]

Congrats on 500 posts bowlhead99, may we see many more

atush

ColdIron wrote: »

Congrats on 500 posts bowlhead99, may we see many more

Ditto!

But having to pay only 1560 per year for a FS pension would be something Very special.

And after cash savings, S&S isas and maybe a home deposit is addressed, i'd be looking to put more into pensions- at least enough to take advantage of that 40% tax band.

badger09

ColdIron wrote: »

Congrats on 500 posts bowlhead99, may we see many more

atush wrote: »

Ditto!

Double ditto

At a very conservative estimate, I'd say at least 495 of them were well worth reading :T

And the other 5 went 'Whoooshhhh' :eek: