Pension or ISA?

JB32

Good afternoon all, I would very much appreciate some advice around whether to invest into a pension or ISA, based on the below details:

1. I have a defined contribution company pension scheme, where my company pays in 9% and I pay in 6%. The current balance is £30,000.

2. I am aged 49 and am a basic rate tax payer, with limited chance of becoming a higher rate tax payer. 

3. I have an investment ISA with Hargreaves Lansdowne (HL), with a current valuation of circa £3,000. I invest £400pm into this every month. I use a tracker fund to keep costs down.

4. I have an interest only mortgage with a balance outstanding of £66,000 and with 10 years to run. I will be looking to repay the capital either through saving into my pension or ISA.

5. I am looking to increase my current savings (£400 into ISA) to £1,000pm.

I would be most thankful if someone could provide me with some guidance as to what to do?

A. Should I set up a SIPP with HL and transfer my works pension to them?
B. Would my employer pay their 9% and my 6% contributions into a HL SIPP? 

C. Should I transfer my ISA balance into the SIPP to benefit from tax relief?
D. Should I channel the proposed £1,000 savings into the SIPP?

I hope someone can help. Thank you

MX5huggy

Does your employer offer Salary Sacrifice pension contributions?

A. Set up a SIPP yes, with HL no they are expensive for small pots. You maybe able to transfer your existing company pension to a different provider but why, what are the fees and fund choices

B. probably not the company would have a nightmare if every employee chose a different pension provider.

C. Yes but you don’t need to do it now (unless you thought tax relief was to be removed). Do it closer to retirement. 

D. Yes SIPP is better than ISA if you are happy to lock the money away. 

What’s the interest rate on the mortgage how long is it fixed for? 

dunstonh

A. Should I set up a SIPP with HL and transfer my works pension to them?

That would require you to opt out of the workplace pension and you would lose your employer contribution (free money).  It could also increase your charges as HL is one of the more expensive platforms (apart from certain areas)

B. Would my employer pay their 9% and my 6% contributions into a HL SIPP? 

Almost certainly not.   Maybe if you were the only employee and of high value to the company they might.  Even then, it may be difficult as employer contributions often require an employer payer form to be completed with each payment.

C. Should I transfer my ISA balance into the SIPP to benefit from tax relief?

The pension wrapper is more tax-efficient than the ISA wrapper if your plan is for the money to be available in the past retirement age range.

D. Should I channel the proposed £1,000 savings into the SIPP?

If it meets your objective, yes.

Albermarle

A. Should I set up a SIPP with HL and transfer my works pension to them?  No
B. Would my employer pay their 9% and my 6% contributions into a HL SIPP? Almost certainly not

C. Should I transfer my ISA balance into the SIPP to benefit from tax relief? If you think you will have no need for the money in the ISA until before your pension(s) are accessible, probably at 57/58
D. Should I channel the proposed £1,000 savings into the SIPP? As point 3 

Same points as above posts but will add a couple more.
What is wrong with your works pension? Normally they are fine for the large majority and often with low charges ( but not always ) 
Whether it is your works pension or another one , what is more important is how they are invested, not who the pension provider is.

tacpot12

I have to agree with Albermarle; what you are invested in is more important that who you are invested in (providing charges are low). Your employer's contribution is valuable. Will they pay more than 9% if you pay more than 6%? If so, you should max out your contributions to your employer's pension. 

wjr4

I’d be changing to a repayment mortgage if possible