Should I pay extra into defined benefit or defined contribution pension?

northnineteen

I've been taking my head out of the sand and trying to understand my two different pensions and where I should put some "extra" money that's available from a promotion and a drop in commuting expenses. I'm 49, so I am very, very, very late!
Is there a simple answer to whether I should put extra money into a defined benefit or defined contribution scheme?

Through my employer, I have a SAUL pension which I gather is a defined benefit CARE plan - Career Average Revalued Earnings. I gather this is a "good" pension.  Work 
pays in I think 16% and I pay 6%.  I've worked there for five years and the amount showing on the yearly statement seems worrying low compared to the amount taken from my salary each month, though I do find the statements hard to understand. Likewise, I find it hard to understand additional contributions, which apparently I can buy in "units" - I quote, " Each unit will give you £250 of extra income a year and £750 of extra tax-free lump sum when you retire."

I asked the SAUL CARE pension for a quote for additional payments and got some bewildering paperwork back.  A monthly payment of £238.64, for example, would give me £1,250 of additional pension (but no time frame given, per what?!) and £3750 "additional lump sum".

I have an old contribution scheme pension with Aegon which I DO understand.  I get a statement each year and although I'm not currently putting any money in, I see that it grows a bit each year. 

The more I faff the longer I keep on doing nothing. 
I'm leaning towards just paying into the Aegon defined contribution but don't want to completely do the wrong thing, which I often do with money!
Other facts: no dependents, could pay in up to £500 each month.  My salary just tips me over into the higher rate of tax.
Thank you for reading and for any advice.

Dazed_and_C0nfused

The CARE pension will work something like this,

Salary £52,000
You contribute 6% = £3,120 (before tax relief)
Your pension accrual for that year is £693.33*

*This will then be subject to some level of inflation proofing

In this example the pension contribution of £3,120 reduces your taxable income to less than the higher rate threshsold.

Care is hard to beat for guaranteed income but the DC fund will add flexibility.

Thrugelmir

northnineteen said:

 I've worked there for five years and the amount showing on the yearly statement seems worrying low compared to the amount taken from my salary each month, 

A decent pension takes years to build along with a reasonable contribution level.  There's no free lunch.  Nor any fairies to magically grow the numbers. Saving requires graft and sacrifice. 

xylophone

https://www.saul.org.uk/#/page/your-calculators. Have you tried these?

If you think that you might wish to stop working before you reach Scheme Pension Age, contributing to your DC pension could enable this.

Have you obtained a State Pension Forecast?

https://www.gov.uk/check-state-pension

MX5huggy

When they say additional pension £1250 , or Dazed & Confused says pension accrued that year is £693.33. 

That is how much per year extra your annual pension will grow by so it’s per year. So if you work for 10 years earning the same amount of money your annual pension would be £6933.30  every year after you retire until you die. If you took the option offered then this would increase by £1250 to £8183.30 per year until you die. 

There’s other things to note, it all index linked so the yearly pension goes up by inflation every year both before and after you retire and start receiving it. This is a massive benefit. Unlike your salary now which increases after a negotiation this happens every year. So actually the £6933.30 will be more than this. 

Then there is also a dependents pension usually your spouse who if they out live you would receive half your pension £3466.65 per year until they die after you die. ( again index linked).

As you can see you are swapping £3120 pounds of pre tax income for a promise that you will be paid £693.33 every year you live after your retirement (plus inflation). The 16% the employer pays is of no concern to you. This is a deal no one else is going to off to pay.

if you retire (and take your pension) early the £693.33 is reduced to reflect that you will be paid more years. Similarly if your delay retirement you will get paid more per year.