£25-50 a month pension

Linton

cuthbertlilly wrote: »

what's so bad about a HL SIPP?

Its not an HL SIPP, its "I would go for higher risk in the hope of good returns, look at all the performance charts etc. and see what takes your fancy, I went for a split of specialist biotech funds and UK small companies."

Better in my view to focus on a predefined broadly based asset allocation. Nothing wrong with the particular types of funds listed, but they are very volatile and so should form only a relatively small part of one's portfolio.

Linton

atush wrote: »

Pay in 50 or more if you can. 25/m isn't enough esp at your age.

Realistically, you should look to be paying in at least 16% of your salary.

If you can get an average return above inflation of 5%, which is reasonably good going and pay in £25/month increasing with inflation you can look forward to an inflation matching income of around £1000/year at current values in 30 years time. Better than nothing but its not a life changing amount above State Pension. If you want to retire comfortably you will need to contribute a lot more than £25-£50/month.

atush

cuthbertlilly wrote: »

thanks, but £1.50 sounds quite high fees on £25 regular payments - there must be better options out there for small contributions?

Which is why I said to put in 50 as you said 25-50.

atush

greenglide wrote: »

With proposed investment amount of £25 noone would invest in investment trusts, ETFs or individual shares.

Even investing in funds would be difficult because of the minimum amounts.

HL is not the cheapest platform by any means but their service is good.

If you are employed by your limited company you want the company to pay into the pension as is is much more tax efficient. You shouldnt make any personal contributions is these circumstances.

You can invest cheaply in ITs but in ISAs, not pensions.

dunstonh

atush wrote: »

You can invest cheaply in ITs but in ISAs, not pensions.

Most platforms have the same costs for ISA as they do pension (and unwrapped). Although that is on the IFA side. It could be different on the DIY side.

HappyMJ

Even £50/month is too low.

£50 multiplied by 12 is £600. £600 then multiplied by 27 years is £16,200. You will have fees reducing that and interest and dividends increasing that and inflation eroding the value. I'll assume that it will be worth whatever it will buy in today's money.

Turn that into a pension and you've got yourself a weekly pension of £15 in today's money. It's just not worth it.

I'd invest in regular savings accounts, high interest current accounts and ISA's before investing in a pension. From next year you can earn £1,000 interest without tax taken off. You'd need around £30,000 at an average rate of 3% before you start paying tax.

As was explained earlier once you've got all your debt paid off you should be looking at investing at least 16% of your income into a pension fund. That would be somewhere around £300 per month if your gross income is £22,500.

atush

dunstonh wrote: »

Most platforms have the same costs for ISA as they do pension (and unwrapped). Although that is on the IFA side. It could be different on the DIY side.

Yes. I think DIY could be more for ITs. In house ISas can be cheap, but only if you just want that company's trusts in your ISA.

atush

HappyMJ wrote: »

Even £50/month is too low.


Turn that into a pension and you've got yourself a weekly pension of £15 in today's money. It's just not worth it.

.

50/m is low, but at least a start and if they increase with time it will be better than nothing, esp better than the cash accts you mention.

And 'turn that into a pension' and you are 25% better off for a start. Add in years of compounding and it is a whole lot mroe than that. So, stuff and nonsense.

cuthbertlilly

HappyMJ wrote: »

Even £50/month is too low.

£50 multiplied by 12 is £600. £600 then multiplied by 27 years is £16,200. You will have fees reducing that and interest and dividends increasing that and inflation eroding the value. I'll assume that it will be worth whatever it will buy in today's money.

Turn that into a pension and you've got yourself a weekly pension of £15 in today's money. It's just not worth it.

I'd invest in regular savings accounts, high interest current accounts and ISA's before investing in a pension. From next year you can earn £1,000 interest without tax taken off. You'd need around £30,000 at an average rate of 3% before you start paying tax.

As was explained earlier once you've got all your debt paid off you should be looking at investing at least 16% of your income into a pension fund. That would be somewhere around £300 per month if your gross income is £22,500.

I have no debt except a 2000-2003 student loan of 13.5k, i've maxed all the regular savers and current accounts, just not sure if i should save up more than my current £123k before going in to property and pensions.

atush

If you have 123K in the bank, i'd be looking to buy a house to live in. If you have one, then definitly pensions and S&S isas.