Personal Pension. NEST

derrick

If someone, (aged 63), who does not have a personal pension has started work at an employment agency and is now offered to be enrolled in NEST. Is it advisable to join?

 Or bearing in mind there are no definite hours so might not work full time, would it just be better to opt out?

 If opting in and after several years contributing, am I right in thinking that if pot is very small then the whole pot could just be taken as a one off payment?

Albermarle

If you do not join you will miss out on the employers contribution , which is free money.
Also due to tax relief on your contributions there is a tax benefit , even if you pay tax when you withdraw.
You can take any pension of this type as a one off lump sum , whether the pension is large or small . 25% is paid tax free and the rest is taxable ( although if your taxable income is below £12,500 you will not have to pay any tax. )

derrick

Thanks but I do know that, my point was that there is no definite hours and jobs may not come along so might not hit the annual threshold of over £10,000 to be eligible for enrolment anyway.

But I do not want them to lose any money by starting contributions then not bring able to withdraw what might be there, it only being a very small pot.

Main question, if they accumulate a pot of say £1200, over say 3 years, would they ba able to take that out all in one, thereby not losing any money?

Dazed_and_C0nfused

They could take £300 tax free and the remaining £900 would be taxable income.

The tax payable on the £900 would depend on what other taxable income was received in the same tax year.

The key thing though that to get a pot of £1,200 might have meant they only paid in say £600.

The other £600 being employer contributions and tax relief.

So unlikely they will get back less than they actually contributed as that is only a proportion of the total pot.

LHW99

And even if they earn less than the autoenrollment limit, they can ask to be enrolled.