New Job

CliveWeasel

HI,

I am about to start a new job which comes with a couple of added benefits, and I waas looking for advice on how to best utilise them:

1) Pension: My employer will pay double my contribution up to a maximum of 14% of salary. I am therefore thinking that contributing 7% gices me the best return. Is this correct?

2) I get a car allowance of around £250 a month (after tax). As the basic salary is similar to my previous job, this is "new, additional" money for me. I have no debt on my current car, which I can sell for £2000 or so. so simple question.... buy or lease?

3) Shares. I can buy shares in the company (I won't name names, but they are the sort of shares pension companies rely on, which pay good dividends of around 4%, and rarely move in price too much. I can buy them pre-tax, and for every five, the company gives me an extra one. I was thinking of getting fice a month (maybe ten a month later), as this maximises the add-on. Is my thinking correct here.

Any advice is welcome. thanks.

asajj

I think this isn't the best board to ask these.

tp_wigwam

1. pay as much as you can afford assuming its taken from your gross pay which would leave you paying less tax on your net salary.

2. keep current car and bank your car allowance!

3. Shares that are matched from your employer may be tax free if you hold on to them for a certain amount of time. You may lose the matched shares also if you sell your own early. check what the T&Cs are and invest what you can afford.

tp_wigwam

Forgot to add:

3. the shares you buy pre tax will only be tax-free if you hold them for usually 5 years. if you sell them early - be prepared to get taxed on the selling value.

d70cw6

why do you think you need to get a new car?

scaredofdebt

Get as many of the shares as you can easily afford, but bear in mind the price can fall, so if you are risk-averse don't to this!

I'd agree with the car advice, bank the allowance while your current car is OK and then probably buy a new one (not brand new, get a nearly new car so you don't take a depreciation hit).

Leasing is OK but you don't mention your mileage etc. If you do a lot of miles leasing isn't good value IMHO.