Should I stop my shares account and put more in my pension

ShandyAndy_2

For the last 10 years I’ve been putting £50 month into a Best Invest aggressive growth shares account, but just lately I have been thinking I’d this the best course of action or would I be better off adding more % of my wages into my nest RAS account which I believe my employer adds a small percentage to.

At the moment we have a low mortgage and low bills, we scrimp and save and I don’t want to be working until I’m 65, I’m 35 years old, married with 2 young children.

Thanks in advance for your replies.

lisyloo

Mathematically the pension is the best option as you get tax relief and possibly employer contribution, employees NI and employers NI.

However pension is completely unavailable until 55 (even if you’re bankrupt/homesless), so you need to make sure you have enough available cash for both foreseeable expenses e.g. big ticket house maintenance and also unexpected but forseeable events e.g. job loss, sickness, accident.

I would suggest you look to save 6 months living expenses before you increase your pension.
This is very much a rule of thumb, so if you know (for example) your boiler is 20 years old or your company is downsizing or you have no sickness insurance then you need to adjust the relevant amount accordingly.

Btw - your state pension age is probably 67-68 not 65

AnotherJoe

Why would you turn down doubling your money (for what your employer matches) plus tax relief?
Dont worry that its a small%, suppose you add 1% and emp adds 1%, thats doubling your money.

barnstar2077

In your situation, If I had enough money for emergencies, then I would invest into a pension. They seem to be linking the earliest you can take it out to state retirement age though, so it would be 58 for you at the moment. This is very annoying for me as I will have enough in my work pension and SIPP by the time I reach 55 to retire so I am having to save an ISA fund to bridge the gap should I decide to retire earlier than 58.

barnstar2077

AnotherJoe wrote: »

Why would you turn down doubling your money (for what your employer matches) plus tax relief?
Dont worry that its a small%, suppose you add 1% and emp adds 1%, thats doubling your money.

As Another Joe says, you need to look into the details of your pension scheme and put in at least the percentage amount that your employer will match. Free money!

If you are really serious however, you should start thinking about how much money you may need in retirement. Then work out the size of pot you will need to achieve it. Then start planning how to make it happen. It's not as daunting as it sounds and this forum and the net are full of useful info to help you.