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Lifetime Allowance
SherlockFawkes
Posts: 2 Newbie
in Cutting tax
OK - 1st World Problem Alert!!
I have been dutifully paying into my pension. I've worked since I was 18 and had a pension all of that time. 30 years later, there's a lot in it. So where's the problem? Well, its pretty evident that even if I don't put in a penny more, I've still got 17 years of working life left in me, and with continued contributions, it will quickly sail through the Lifetime Allowance. The irony is, I spent years during my 20's & 30's, having children and still paying in probably more than I could really afford to. Now all the money I could have done with then, but tried to save for my future, looks like its likely to push me into a high tax situation.
I could stop paying in - And lose the company contributions too, which seems a bit counter productive
I have already throttled back my contributions, so still gaining the company matching limit, and slowing the growth, but wishing I'd done this 5 years ago
I could just let it go through the allowance limit - Just go for it - Plough money in and accept that there is a tax burden to pay. But experts seem to be very against going over the Lifetime Allowance cap.
Just slow down, see how different governments change the rules and hope the allowance gets increased? £1m sounds a lot, but I gather it doesn't provide a stunning annuity for two
any advice gratefully received - Well, except for 'wind your neck in and be grateful'.
I have been dutifully paying into my pension. I've worked since I was 18 and had a pension all of that time. 30 years later, there's a lot in it. So where's the problem? Well, its pretty evident that even if I don't put in a penny more, I've still got 17 years of working life left in me, and with continued contributions, it will quickly sail through the Lifetime Allowance. The irony is, I spent years during my 20's & 30's, having children and still paying in probably more than I could really afford to. Now all the money I could have done with then, but tried to save for my future, looks like its likely to push me into a high tax situation.
I could stop paying in - And lose the company contributions too, which seems a bit counter productive
I have already throttled back my contributions, so still gaining the company matching limit, and slowing the growth, but wishing I'd done this 5 years ago
I could just let it go through the allowance limit - Just go for it - Plough money in and accept that there is a tax burden to pay. But experts seem to be very against going over the Lifetime Allowance cap.
Just slow down, see how different governments change the rules and hope the allowance gets increased? £1m sounds a lot, but I gather it doesn't provide a stunning annuity for two
any advice gratefully received - Well, except for 'wind your neck in and be grateful'.
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Comments
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I think that the experts are right when they advise against exceeding the lifetime allowance. Remember that you don't have to buy an annuity any more. If you haven't used up allowed ISA contributions, use those. After that, look at savings and investments held personally.0
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https://adviser.royallondon.com/globalassets/docs/adviser/misc/1901-annual-lifetime-allowance-guide.pdf
A little bit old but the principles remain regarding contribution still continuing beyond the LTA. So don't discount it and consider it and see if it fits your requirements"It is prudent when shopping for something important, not to limit yourself to Pound land/Estate Agents"
G_M/ Bowlhead99 RIP0 -
Thanks - That's an interesting guide. Cheers0
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Have a search on the pensions board, loads of discussions on this there.
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