Opted out of work place pension

dunstonh

They just added it to the net amount when they paid me. But bizarre.

That is because you have to pay tax and NI on it.

Next stop look into the best scheme to put it all in!

That will be the one you just opted out of (in the respect of future money contributions) as nothing beats free money.

silverwhistle

mingus2003 wrote: »

Wow all I did was ask for advice what to do!

You were told, and got good advice as to what to do, as far as I can see! :-)

I can understand the desire for consolidation, but the frozen pensions are with previous employers. The current one is 'live' and the employer will be contributing something. Out of interest what would that latter percentage be? In today's world every little bit helps.

atush

Basically, Nothing you can do with your taxed money will be better than the work pension as you are giving up free money and TR.

Given you didnt seem to understand this, i'll try again.

Say you put 8 quid into that work pension, the govt will give you 2, plus the employer 10.

That means you get 20 at the cost of 8 to you.

So again, why do you think opting out is wise? Why is 8 better than 20?

kingrulzuk

atush wrote: »

Basically, Nothing you can do with your taxed money will be better than the work pension as you are giving up free money and TR.

Given you didnt seem to understand this, i'll try again.

Say you put 8 quid into that work pension, the govt will give you 2, plus the employer 10.

That means you get 20 at the cost of 8 to you.

So again, why do you think opting out is wise? Why is 8 better than 20?

Oh I thought it was you put in 10 quid, the govt puts 2 and the employer puts 8 = 20 quid

PeacefulWaters

mingus2003 wrote: »

Wow all I did was ask for advice what to do!

Anyway turns out they have reimbursed me my deduction, wasn't shown itemised going back like it did as when deducted.

They just added it to the net amount when they paid me. But bizarre.

Next stop look into the best scheme to put it all in!

Think the following way:

1) Where's the best place for the old "frozen" pots?
2) How do I best optimise my employer's contributions to my retirement fund?
3) If I can afford more after achieving (2) where is the best place for that?

Deal with (1) last.

AnotherJoe

kingrulzuk wrote: »

Oh I thought it was you put in 10 quid, the govt puts 2 and the employer puts 8 = 20 quid

Nope. If you did put in £10 through an employment scheme, thats £10 before tax. If you were paid that £10 in your salary instead of pension, you'd pay £2 tax on it, ending up with £8 . Your employer matches what you put in, and you put in £10 so they put in £10 also.

As atush cogently put it, why would someone think that £8 in an ISA (or £10 in a personal pension if they took the £8 after tax and put it into another pension) is better than £20???

atush

But the OP thought I was being mean, but I think they just need to understand why their choice could very well be the wrong one.

bigfreddiel

Isn't amazing the lack of understanding on pensions!

I think the real problem is why this is?

Who is responsible for this ignorance on pensions?

The providers, the employer, IFAs, FAs, accountants, the government the education - schools, unis, teachers, or is it us, the poor old ignorant employee?

Just a thought fj

atush

I think some of the ignorance is willfull

PeacefulWaters

bigfreddiel wrote: »

Isn't amazing the lack of understanding on pensions!

I think the real problem is why this is?

Who is responsible for this ignorance on pensions?

The providers, the employer, IFAs, FAs, accountants, the government the education - schools, unis, teachers, or is it us, the poor old ignorant employee?

Just a thought fj

Most people are smart enough to work out that they need something for retirement. They're not always proactive enough to do something about it.

The excellent concept of forcing employers to contribute to an employee's retirement unless the employee tells them not to means that (with one or two unusual exceptions) only a fool with self destructive instincts would take such an approach.

This is not a problem of poor communication by state or employer. This is an example of an individual choosing to do something idiotic.