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paying extra int works pension
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Mick70
Posts: 743 Forumite

if employer doubles the employee contributions up to a limit of employee 8% and employer 16% , is it worth still paying in more than that or should any other money you can afford be better off put into a savings account/ISA ?
thanks,
mick
thanks,
mick
0
Comments
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Mick 70 - A thread a day ( or two today ) keeps the Doctor away
If you are a higher rate taxpayer then you should maximise pension contributions as much as you can , especially if you will be a 20% taxpayer in retirement. If you are a basic rate taxpayer the advantage is still there but a lot less.
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Albermarle said:Mick 70 - A thread a day ( or two today ) keeps the Doctor away
Ive got couple more questions yet my friendshy bairns get nowt
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Mick70 said:Albermarle said:Mick 70 - A thread a day ( or two today ) keeps the Doctor away
Ive got couple more questions yet my friendshy bairns get nowt
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Mick70 said:if employer doubles the employee contributions up to a limit of employee 8% and employer 16% , is it worth still paying in more than that or should any other money you can afford be better off put into a savings account/ISA ?
thanks,
mick0 -
My pension scheme works at about those percentages as well (yes, lucky us, would be nicer if there was no upper earnings cap on the scheme but 1st world problems...). I'm currently paying another few percent on top with no extra top up from employer, just to ensure I'm using every bit of my allowance/carryover, and reduce my 47% tax liability.
It's really one of those no-brainer decisions...0 -
Brynsam said:Mick70 said:Albermarle said:Mick 70 - A thread a day ( or two today ) keeps the Doctor away
Ive got couple more questions yet my friendshy bairns get nowt
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Easy way to think of it is that you have already paid tax and NI before you can invest it in an ISA or Savings so you have already lost a massive chunk. But obviously putting everything into your pension doesnt give you flexibility so its a balance. I generally try to up my personal pension contribution by another 2% a year usually inline with annual pay rise so I dont even notice the difference in take home.
Fingers crossed that the rumours about the govt stopping the higher rate tax relief on pensions is just a rumour.0 -
Albermarle said:Mick 70 - A thread a day ( or two today ) keeps the Doctor away
If you are a higher rate taxpayer then you should maximise pension contributions as much as you can , especially if you will be a 20% taxpayer in retirement. If you are a basic rate taxpayer the advantage is still there but a lot less.
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