NEST Pensions - increasing contributions?

JustAnotherSaver

xylophone wrote: »

See post 4.

What is a good place to go for the private pension then?
Or maybe a better question may be what is good to avoid? With the fees.

xylophone

She could try here

https://www.cavendishonline.co.uk/pensions/stakeholder-and-personal-pensions/

Or she might consider a SIPP with the likes of Hargreaves Lansdown or Charles Stanley?

http://monevator.com/compare-uk-cheapest-online-brokers/

http://monevator.com/no-time-to-invest/

http://monevator.com/vanguard-lifestrategy/

Some reading above.

JustAnotherSaver

I had a brief google myself & saw the mention of Hargreaves Lansdown.

How does that compare to their S&S ISA? I'll explain what i'm talking about....

A few years ago, my brother & sister knew they wanted to start saving for retirement but didn't have a clue where to begin. They're extremely green. They asked me to start it for them (& so i went with HL after many mentions on here). I did tell them that i'd rather not & explained the risks, especially with me not knowing what i'm doing. They were happy & wanted me to set it up for them.

So i did. And i selected the funds they invested in.

We were talking small amounts for them, but in time it grew to a fair size (for them), enough that i became very uncomfortable being in control of it.
So i called up the IFA i mentioned earlier who came out to the house & went through it. I explained to him i wasn't comfortable managing this because i was basically clueless. My brother & sister were happy for him to take over.

Why was i clueless? Because my fund selection was essentially close eyes & select.
It just happened to be pure luck that my sisters grew 12% & brothers grew 8%. It could've dropped by double that & more.

I would forever stay with these funds as i wouldn't know when to buy new ones, when to sell, when to buy more of existing. It'd be purely what i felt like at that moment. It needs to be managed by someone who is educated in the area.


So bringing that back on topic - if my wife was to set up her own pension with HL, would she have to select the funds herself like with the S&S ISA, or is a pension with HL a bit different & she could select something like 'open to risk' & it'd invest it in funds itself which would be managed by some HL operative?

bigadaj

Depending on when ages years ago means then things could well have changed a bit.

HL come in for a bit of flak on here because they are a bit more expensive, along the m&s or Stella type line, and had a reputation for promoting funds on the basis of their commission or incentives rather than quality or history of good performance.

They are however good at customer service and are responsible so for small amounts they can be good.

You would have to choose your investments but for most people there are plenty of multi asset type trackers that rebelance and can be a fire and forget option, thinking vanguard lifestrategy, l&g multi index, black rock consensu, fidelity and others. They offer different versions accotpring ti age and attitude to risk, and you simply contribute once set up.

For what you suggest in your last post then xylophones suggestion of looking at cavendish sounds useful, they basically offer a portal with low fees to personal pensions from the traditional pension providers. So you set up a scheme through them, they take a small commission and you then contribute at low charges to personal pensions like aviva, aegon, etc . The latter option means there are a bit easier default funds you can choose, they're possibly a bit more expensive than the funds I've mentioned above, but overall theres little in it and it might be less daunting.

JustAnotherSaver

Thanks. I'll try & learn a bit about it. The problem comes when you start needing to change funds (basically manage the thing) because i simply don't know when to do that.

The S&S ISA we currently have is managed totally. We pay in our money & the funds are changed as time goes by by people who are supposed to know what they're doing (or at least know more than i do).

If i knew what to be doing then i could do it myself but simply i don't so i need someone managing it for me.


How do you calculate the % to put in to these though?

I like the workplace pension because it's all automatic. You decide a % & that % comes out automatic. When doing it yourself you have to calculate it.


So let's take an entry from my wifes payslip...

Gross for Month: £1,558.86
Tax: £137.40
Nat Ins: £106.56
Net Pay: £1,314.90


I've done this for myself & found that the 1% isn't from either the net or the gross, it must be from some other figure.


So for one of these things i would guess you would have to calculate your decided percentage % for say September & then put it in to October's private pension manually (if that's allowed)?


If we were doing that with our current S&S ISA then we would have to ring our IFA up each & every month saying - can you pay this amount more in for us this month, or - had a bad month this month can you pay in less.

bigadaj

I think you are over complicating matters.

I'm surprised that you use an ifa for your isas, I would have thought it would be too expensive or not worth his while given what he probably need to charge on a time basis.

If you take the cavendish example, you simply apply through them to get a personal pension from one of the big insurers, they offer a discount and you then contribute what you want, normally a standing order for say £100 a month, minimum is probably £50 and maximum is your total pay with some exceptions.

That way you can simply look at the funds they offer and match one to your risk profile, there are usually things like cautious managed, adventurous etc etc. Trustnet and Morningstar websites hold data on the majority of funds so you can see the largest holdings, geographic breakdown, amount in shares/ bonds/ property etc

Your comtribution is whatever you determine, choose 5% and earn £1000 a month so you put in £50 per month.

A rough rule of thumb is that you contribute half your age as a percentage, based in whe you start, so starting at 30 you should put in 15% of gross salary, normally inclusive of employers contribution and tax relief. So that 15% might be 5% from your employer, and if a basic rate taxpayer 10% gross contribution would have 2% tax so actual cost would be 8% of net pay.

Without detailing the pension contribution it's difficult to say how it's calculated, it would normally be on gross pay but can be exclusive of overtime, bonuses, shift allowances etc etc

JustAnotherSaver

bigadaj wrote: »

I think you are over complicating matters.

I get told that a lot.

But if i don't understand something to a level that satisfies me then i ask as many questions as i need to until i do understand it. Especially where money is concerned.

choccielover

JustAnotherSaver wrote: »

Thanks. I'll try & learn a bit about it. The problem comes when you start needing to change funds (basically manage the thing) because i simply don't know when to do that.

The S&S ISA we currently have is managed totally. We pay in our money & the funds are changed as time goes by by people who are supposed to know what they're doing (or at least know more than i do).

If i knew what to be doing then i could do it myself but simply i don't so i need someone managing it for me.


How do you calculate the % to put in to these though?

I like the workplace pension because it's all automatic. You decide a % & that % comes out automatic. When doing it yourself you have to calculate it.


So let's take an entry from my wifes payslip...

Gross for Month: £1,558.86
Tax: £137.40
Nat Ins: £106.56
Net Pay: £1,314.90


I've done this for myself & found that the 1% isn't from either the net or the gross, it must be from some other figure.


So for one of these things i would guess you would have to calculate your decided percentage % for say September & then put it in to October's private pension manually (if that's allowed)?


If we were doing that with our current S&S ISA then we would have to ring our IFA up each & every month saying - can you pay this amount more in for us this month, or - had a bad month this month can you pay in less.

Qualifying earnings?

http://www.pensionsadvisoryservice.org.uk/about-pensions/pensions-basics/automatic-enrolment/how-much-do-i-and-my-employer-have-to-pay?moreInfo=4