Should I opt out of my pension and use the money to pay my debt.

2bFrank

Hello Everyone,

Ive got myself into £4430in debt. Please look at this thread http://forums.moneysavingexpert.com/showthread.html?t=519412 for further information.

Anyways after doing a full budget plan and SOA, I wont be debt free until April 2010. However I have had a thought, What if i opted out of my local goverment pension at work and used the money to pay off my debt?

After reading into it, I would lose alot of privilages that I have at the moment (such as life insurance, etc) Also with the change of pensions, if I opt out, I am unsure if I can opt back in at a later date.

I currently pay £100 per month into the pension. If i used this money for my debt, i could be debt free the end of 2008. Thats two years knocked off my debt free date. Any thoughs or words of wisdom whould be much appricated.

Regards

elantan

i personally wouldnt you are gonna need your pension and if you have an employer paying into it then you have one a large amount of people (myself included) dont so i would deff keep it ...you will become debt free it will just take time have you tried selling things on ebay or taking a second job?

Broken_hearted

Don't throw your pension away for the sake of two years it isn't worth it.

CLAPTON

no dont do that...keep the pension going.
Not only do you get useful insurance etc also remember that you won't actually have 100 ... after tax its only 78 and you will probably have to pay more NI too.

Dr_Hook

Your pension contributions aren't taxed, so when you opt out your net pay will only increase by around £75ish.

Definitely not worth it IMO.

Edit: Clapton beat me to it!