Starting to save for retirment

RBYHS

Hello everyone!
I am 20 and I am currently working full time - however, I am not contributing to a private pension yet.
I am planning to opt-in for the pension with my current employer and take advantage of their maximum contribution and match it. 

Furthermore, I was looking at Vanguard for pension and investments. Would you recommend using them?

I am new to all of this but I really want to start planning for the future. Any advice would be much appreciated! 

Thanks

MallyGirl

why do you want to have another pension in addition to the employer one?
Who operates it?
Is it salary sacrifice?
you shouldn't need to opt in - you should be auto enrolled these days I thought.

Vanguard is cheap as long as you want to use only Vanguard products. That might not be the right thing, or it might - not enough info.

TheMilkmansDad

you auto enrol if you're 22+, but you can ask to enrol if you're younger.

What are your other financial plans? House, start a family, etc. Maybe look at a LISA or something similar to complement your works pension as a start?

Marcon

RBYHS said:

Hello everyone!
I am 20 and I am currently working full time - however, I am not contributing to a private pension yet.
I am planning to opt-in for the pension with my current employer and take advantage of their maximum contribution and match it. 

Why not ask to join your employer's scheme now? If you are aged at least 16 and earning at least £10,000 pa, they must enrol you if you ask - and pay employer contributions.

Anonymous101

Hi,

I'd certainly recommend opting into your employer pension and maximising the matched contribution as soon as possible i.e. now.

As for secondary personal pensions I'd be slightly more cautious. I absolutely believe in saving hard for your future as early as possible, and vanguard are a good provider but you are probably better contributing more to your employer scheme especially if you're contributing through salary sacrifice.

There's also a lot of other things to consider which will be specific to you and your situation. For example, are you a homeowner? If not, and you have aspirations to be one day, then a LISA is often the best place to put any investments prior to purchasing a house.
Alternatively if you're on a career trajectory that would lead to being a higher rate tax payer, £50k+, then a good long term plan might be to invest in a S&S ISA whilst you're a lower rate tax payer then switch to pension once the tax saving is larger.

Also at a young age the flexibility aspect is a big factor. Pension savings are locked away until later in life, 55 now but changing to 57 shortly and likely to change again several time prior to your access age. So maintaining the flexibility of say investing in a S&S ISA is worth considering.

There's a few intricacies which are personal but generally investing as soon as possible in your future self is never a negative.

RBYHS

Anonymous101 said:

Hi,

I'd certainly recommend opting into your employer pension and maximising the matched contribution as soon as possible i.e. now.

As for secondary personal pensions I'd be slightly more cautious. I absolutely believe in saving hard for your future as early as possible, and vanguard are a good provider but you are probably better contributing more to your employer scheme especially if you're contributing through salary sacrifice.

There's also a lot of other things to consider which will be specific to you and your situation. For example, are you a homeowner? If not, and you have aspirations to be one day, then a LISA is often the best place to put any investments prior to purchasing a house.
Alternatively if you're on a career trajectory that would lead to being a higher rate tax payer, £50k+, then a good long term plan might be to invest in a S&S ISA whilst you're a lower rate tax payer then switch to pension once the tax saving is larger.

Also at a young age the flexibility aspect is a big factor. Pension savings are locked away until later in life, 55 now but changing to 57 shortly and likely to change again several time prior to your access age. So maintaining the flexibility of say investing in a S&S ISA is worth considering.

There's a few intricacies which are personal but generally investing as soon as possible in your future self is never a negative.

Hi, thank you!

I am on a very good career path and things are looking bright. I am on 35k now and by 30 I should be at least on 50k considering how the promotions are structured at my company. 
I am not a homeowner yet, but the dream is to soon be one and hopefully own multiple investment properties. 

There are so many options that I feel overwhelmed and confused. But thank you for making everything clearer...

What services would you recommend for S&S ISA? 

Rob.

Albermarle

What services would you recommend for S&S ISA?

Not quite sure what you mean by this question ? If you mean which S&S ISA to go for then first remember that your money will be in investments within the S&S ISA and not directly in the S&S ISA , which is only a 'tax wrapper' to use the jargon.

Things to look for when choosing a S&S ISA are

Charges; range of investments available ( can be 5 to 5,000) ; is it a robo advisor ( guides you to investment schoices by asking various questions ) ?

Stocks & shares ISAs: find the best platform - MSE (moneysavingexpert.com)

Anonymous101

RBYHS said:

Hi, thank you!

I am on a very good career path and things are looking bright. I am on 35k now and by 30 I should be at least on 50k considering how the promotions are structured at my company. 
I am not a homeowner yet, but the dream is to soon be one and hopefully own multiple investment properties. 

There are so many options that I feel overwhelmed and confused. But thank you for making everything clearer...

What services would you recommend for S&S ISA? 

Rob.

Being on a good career path certainly makes things easier. Just don't fall into the trap of lifestyle inflation too much!

I know this stuff can seem complex initially but a little effort to understand investing and the various different wrappers now paired with setting yourself up an outlined plan can really pay dividends.

The main types of accounts to educate yourself about would be Pensions and Stocks and Shares ISA's (including Lifetime ISA's) once you have a basic understanding of these everything else fits around them.

There's loads of podcasts / facebook groups and blogs which go some way to detailing this I especially like monevator.com but it can take a few tries to get your head into initially. As a first pass the Financial Independence UK facebook group has a flowchart that I know really helps many people. Maybe have a look for that?