MSE News: Budget 2014: Radical reforms to give greater access to pensions savings

gadgetmind

bigadaj wrote: »

My partner gets all of the employers NI but she's a better negotiator than I am.

We get about 11% of the 13.8%, which is pretty good. The rest probably doesn't even cover employer's admin so I don't begrudge it.

actd

atush wrote: »

Salary Sacrifice should be taken if available.

Not only do you save income tax, you save on paying Nics on the money as well. And your employer saves Nics too (and sometimes they will give some/all of this savings to you).

I would normally agree, but in my case, the workplace pension is giving an estimated return of 6.75%, so a £50 per month contribution with salary sacrifice will give me a pot of just over £14k after 11 years, whereas with L&G's current return of 17% means that, even without the NI benefit, will give me a post of just over £24k - seems to me that I am best putting the money into L&G as long as they keep these returns up, and if/when it drops, then switch those payments into salary sacrifice - just means I need to review on a regular basis, which isn't a problem. I'd also need to recalculate in say, 5 years, when the effect of the NI relief would be greater as I would only be 6 years from retirement then.

eastcorkram

atush wrote: »

Salary sacrifice is when they pay in for you, so yes you'd speak to your employers HR or payroll dept.

Do you think that this would require a new contract to be written? Stating that, for arguments sake, they were to reduce my pay by £6000 per year, and pay that sum into the pension scheme? Presume it is not just done on trust.

Also, what happens to the employers contribution? As it is now, I pay 10% and the employer pays 2.5%

My basic pay for a year is £34,000, but gross for a year with overtime is usually about £41,000. Getting hit for tax, as my code for the last year has only been 31L. This will change as from next week to 518L. This was due to a mess up about benefit in kind.

I am weekly paid. If I 'sacrifice' £115 per week, how much would I save in NI?

kidmugsy

actd wrote: »

… the workplace pension is giving an estimated return of 6.75% ... whereas with L&G's current return of 17%

Is it wise to compare the past return from whatever investments you have within the L&G wrapper with a projection for whatever investments you will have within the workplace wrapper? Surely you choose the investments anyway?

atush

eastcorkram wrote: »

Do you think that this would require a new contract to be written? Stating that, for arguments sake, they were to reduce my pay by £6000 per year, and pay that sum into the pension scheme? Presume it is not just done on trust.

Also, what happens to the employers contribution? As it is now, I pay 10% and the employer pays 2.5%

My basic pay for a year is £34,000, but gross for a year with overtime is usually about £41,000. Getting hit for tax, as my code for the last year has only been 31L. This will change as from next week to 518L. This was due to a mess up about benefit in kind.

I am weekly paid. If I 'sacrifice' £115 per week, how much would I save in NI?

Little bit complicated for me this time of night I can say next year you are being thrown in HRT due to the benefit in kind situation. get there clarified, asap/ If someone made a mistake (not you) and you hav estra rtax to pay you could get something back?

if it is your employer who got it wrong, using that might help with asking to put more thru SS (as they save nics too) so do look into it.

bigadaj

gadgetmind wrote: »

We get about 11% of the 13.8%, which is pretty good. The rest probably doesn't even cover employer's admin so I don't begrudge it.

I thought every penny was a prisoner when it came to your pension.

I'm not sure it is actually any more expensive to administer the NI rebate, though I suppose it depends on the take up at each company, if people aren't taking advantage of it and they are having to administer two separate processes then it would no doubt take some more time.

Nurse_Liz

Please can someone advise me on how to find a good impartial pensions advisor who is fully au fait with all the recent changes and can help me to understand my options.

I wrote to the Pensions Advisory Service but they weren't able to help.

Thank you.

jamesd

If you just have questions about your situation, one good way is to start a discussion here with your questions. Be sure to mention all of your pensions and their normal retirement ages (called normal pension date in your RBS pension). Also if you can, find out whether they can be taken early with an "actuarial reduction" for taking them early .

It would also be useful for us to know whether you are still working and roughly what other savings and investments you have available, as well as your current age, the age at which you want to retire and the income you need after tax when retired. If you have one it would be helpful to know what your state pension statement says. You can ask for that online.

Given your time in the excellent RBS and NHS pensions you were probably contracted out for much of your working life so it's quite likely that you will have a state pension under current rules that will not be as high as the flat rate. However since you were expecting to be 50 in May 2010 that means that you will be reaching state pension age under the new rules and it will be easy to get more years to get you to the full £144 a week flat rate, which will probably be more like 15 by the time it starts, due to inflation adjustments since it was announced.

dunstonh

Please can someone advise me on how to find a good impartial pensions advisor who is fully au fait with all the recent changes and can help me to understand my options.

https://www.unbiased.co.uk is the main database of advisers (restricted but whole of market/IFA)

wrote to the Pensions Advisory Service but they weren't able to help.

They are not advisers. More overseers. Advice will come at a cost though.