H.Lansdown & AJ Bell - Lifetime ISA

JustAnotherSaver

Alexland wrote: »

Now if you have an employer who offers salary sacrifice National Insurance saving then that can be a further 12% saving on workplace pension contributions in which case it roughly matches a LISA for efficiency.

Alex

Unfortunately my employer is one of those who will only give what they have to give by law. I've asked about salary sacrifice & they wont do it.



I asked why, because as i understood it up to that point it was a win-win for employee and employer.


They told me i should read about it more & understand it better because one of the reasons they wont do it is because they still have to do it when people are signed off work.



At least i asked. :rotfl:

masonic

JustAnotherSaver wrote: »

They told me i should read about it more & understand it better because one of the reasons they wont do it is because they still have to do it when people are signed off work.

Hmm, I don't think that's actually true if they keep the link between wages and employer pension contributions.

It took a couple of years pushing by several people to get my employer over the hurdle of putting it in place. The employers' savings from the scheme are greater than ours, but the change creates work for someone.

Alexland

Interesting your employer must have a high level of sick pay for it not to be of overall benefit. Unlike employee NI which tails off at 2% for higher earners the employer continues to pay an eye watering 13.8%. My employer is saving thousands on my additional pension contributions. I manage the P&L cost centre which pays my own salary so can see it from both sides.

https://www.gov.uk/national-insurance-rates-letters

Still in your situation when comparing SIPP to LISA contributions the LISA is clearly more advantageous as there is no tax whatsoever on withdrawal. Provided you accept the slightly increase fees and later access date.

However if you never save much into your pension then your total income (SP + 75% annuity or drawdown) might be below the inflation adjusted £11,850 pa anyway.

Alex

JustAnotherSaver

Alexland wrote: »

Interesting your employer must have a high level of sick pay for it not to be of overall benefit.

There always seems to be someone on the sick in at least one department. Usually for scattered days - so nobody is actually paying anything but there's also been frequent long term sick over the years. weeks here, months there, half years even & then there's also been people who've blatantly been taking the piddle.