my temp job has given me a pension - advice please

unclebumpkin1

Hi.

I'm temping but my temp job recruitment agency will automatically enrol me into pension from mid-january. I think under new government rules. Just wanted advice - about whether it is worth putting extra money in or pulling the money out totally (if that is easy to do). I know very little about this subject. Think I may be start things myself earlier before automatic enrolment - not sure though. This is just a temp job and it very likely may even end in January.

Just wanted some advice as I know so little about this all.... thank you.

It is with NEST.

PeacefulWaters

Contribute whatever the maximum amount is to get the best matching contribution from the agency.

Leave the money invested there until you find a new job. At that point investigate the pros and cons of moving it to your next employer's pension scheme.

While it might only be a small amount, it is at least some contribution to your retirement.

In your position I wouldn't pay more in than I suggest above, unless you're paying 40% tax. Start higher contributions when you have a longer term commitment to the employer.

jamesd

Put nothing more into NEST than required to get the full employer match. That'll probably be just 1% of your pay.

NEST does things like banning transfers in and out and has a very limited investment range so it's far from an ideal place to have pension money but it's not so bad that it is worth not getting employer matching. The restrictions will probably be removed eventually, maybe in 2018.

You can opt out when auto-enrolled. It's worth considering what the value of 2% of pay for the time you think you'll be there is. If it's trivial it might be worth saving some pension tracking hassle and just opting out. Say if you think the total would be £50 or less.

AEGuru

unclebumpkin1 wrote: »

Hi.

I'm temping but my temp job recruitment agency will automatically enrol me into pension from mid-january. I think under new government rules. Just wanted advice - about whether it is worth putting extra money in or pulling the money out totally (if that is easy to do). I know very little about this subject. Think I may be start things myself earlier before automatic enrolment - not sure though. This is just a temp job and it very likely may even end in January.

Just wanted some advice as I know so little about this all.... thank you.

It is with NEST.

Hello, it's hard to say without knowing the contribution details but I'm going to go ahead and assume the company is going along with the minimum contributions required by law.

If you're happy to give up 1% of your wage then go ahead and stay in the scheme. Really you will only be contributing 0.8% and HMRC will contribute the other 0.2% for you in the form of tax relief. Your employer will then contribute at least 1% for you also, even though you won't be in their employment for long.

Once you leave the temp agency, find a new employer and are automatically enrolled onto another scheme. You can then talk to both providers and look at getting the pension transferred across.

One of the benefits of NEST pensions are that they are transferable so this shouldn't be an issue.

I hope this helps

AEGuru

greenglide

I thought that one of the disadvantages of NEST was that you can't transfer out.

But they may change in future.