'Annuities' do i wait?

lennyhenry84

I know very little about pensions and I've given it my best shot in a small amount of time so here it is……….

I have left it very late to start a pension, as I'm close now to 30. I understand from the main site that annuities are going to finish in 2015, so my question is should i wait until next year to start a pension?

I'm not going to be enrolled on the new government pension scheme until worse case 2018, as I work for a small company of only two employees.

My second question is do i get a high risk pension knowing in a few years i will be enrolled in another pension scheme. I then could reduce the amount i contribute to it, and have it on the side and therefore when i retire it may or may not pay off in my favour??

Or have I clearly not understood and need to see a IFA

thanks for any help given

jem16

lennyhenry84 wrote: »

I know very little about pensions and I've given it my best shot in a small amount of time so here it is……….

I have left it very late to start a pension, as I'm close now to 30. I understand from the main site that annuities are going to finish in 2015, so my question is should i wait until next year to start a pension?

Annuities and pensions are two very different things. A pension is what you use to build up your retirement pot. An annuity is what you buy with your pension pot once you are ready to retire.

Annuities are not going to finish in 2015 and for some they will remain a very viable option. What is going to change, provided it gets through parliament, is that you will be able to take the whole of your pension as a lump sum if you wish. Currently you cannot do that.

I'm not going to be enrolled on the new government pension scheme until worse case 2018, as I work for a small company of only two employees.

It's not a government pension scheme. It's simply that the government are insisting that all employers must offer a pension scheme by a certain date.

My second question is do i get a high risk pension knowing in a few years i will be enrolled in another pension scheme. I then could reduce the amount i contribute to it, and have it on the side and therefore when i retire it may or may not pay off in my favour??

It's certainly an option open to you although that decision would not necessarily be to go high risk.

atush

You could open a Personal pension now, and pay into it. You can decide your risk level yourself. High, low or somewhere inbetween.

To look at DIY options, go to Cavendishonline. To look for an IFA, go to unbieased.co.uk

PeacefulWaters

lennyhenry84 wrote: »

I have left it very late to start a pension, as I'm close now to 30

Many leave it longer and regret it. So well done on thinking about it.

I understand from the main site that annuities are going to finish in 2015

Not the case. But annuities are about retirement income. Worry about them in twenty years time.

so my question is should i wait until next year to start a pension?

No. Stop waiting and act now. Do something!

My second question is do i get a high risk pension knowing in a few years i will be enrolled in another pension scheme. I then could reduce the amount i contribute to it, and have it on the side and therefore when i retire it may or may not pay off in my favour??

There is some sense in your thinking but this is your future income you're talking about so heading straight to the top of the risk scale might not be the best idea. I'd certainly be steering away from the lower end of the risk scale though.

Your thoughts of reducing contributions may be flawed though. You've got a decade to recover. Mindset needs to be around more, not less.

Or have I clearly not understood and need to see a IFA

I would keep asking questions here and then DIY. IFA costs not good!

Read up a bit on Cavendish Online.

lennyhenry84

Hi thanks for the advise.

IFA seems a good option. Annuities was an issue as I wouldn't want sign into something I can't ever change especially if they won't exist next year.

jem16

lennyhenry84 wrote: »

Annuities was an issue as I wouldn't want sign into something I can't ever change especially if they won't exist next year.

Which is not the case as we said.

jem16

atush wrote: »

To look for an IFA, go to unbieased.co.uk

Make that https://www.unbiased.co.uk

lennyhenry84

Sorry I hadn't read all the above postings, they have helped massively so thank you. I won't wait and I understand pensions and annuities are two separate things.

Cheers again, I will most probably post again later when I've taken it in with some more questions so I would be most grateful if you could lend a hand again .

Cheers

lennyhenry84

Ok so would you agree that if your not vey good with your finances annuities would be the best option.

What if your good with your money and being able to access it early to move it somewhere to increase it, example as I've read before 'buy to let'.
Would that be a good reason to wait? I suppose being that I've started late I've probably ruled that option out anyway?

Secondly my thinking is that maybe increasing the amount I pay into the enrolment scheme would be better because my employer would have to match it. It's a fine line between paying a large amount into my pension and being able to live. I do understand I would have to do a lot now to recover the lost time, but that's my reason behind reducing the personal pension anyway?

atush

jem16 wrote: »

Make that https://www.unbiased.co.uk

Thanks for the spellcheck Jem lol!

And yes, it is always best to read ALL the replies if you post a question

jem16

lennyhenry84 wrote: »

Ok so would you agree that if your not vey good with your finances annuities would be the best option.

You still don't seem to be reading the replies. An annuity is what you will buy when you are ready to retire and it's only one option.

What if your good with your money and being able to access it early to move it somewhere to increase it, example as I've read before 'buy to let'.
Would that be a good reason to wait? I suppose being that I've started late I've probably ruled that option out anyway?

Pensions can only be accessed at age 55. That might change to be later but not earlier.

As to "buy to let" do you know anything about being a landlord? To make it workable you would have to have more than one property.

Secondly my thinking is that maybe increasing the amount I pay into the enrolment scheme would be better because my employer would have to match it.

They don't have to match it. Some employers will but only up to a certain level.

It's a fine line between paying a large amount into my pension and being able to live. I do understand I would have to do a lot now to recover the lost time, but that's my reason behind reducing the personal pension anyway?

When it comes to the company pension, you contribute enough to get your employer's contribution whatever that will be.