My husband is in his mid 40s runs his own business and does not have a pension

Cooboo

My husband is in his mid 40s runs his own business and does not have a pension. Has a low income. We have some profit we made from our house sale I want him to invest it in to a pension. We have £10,000. Advice would be so appreciated. 

Marcon

Cooboo said:

My husband is in his mid 40s runs his own business and does not have a pension. Has a low income. We have some profit we made from our house sale I want him to invest it in to a pension. We have £10,000. Advice would be so appreciated. 

How 'low' is low? The maximum he can contribute is the higher of his earnings or £3,600 (both figures gross - i.e. including basic rate tax relief, even if he's a non-taxpayer). If his earnings are under £10K he could invest some this tax year and some next tax year, or (if you too don't have a pension) perhaps you could invest some in a pension for yourself?

One caveat: he won't be able to access his pension until at least age 57, so if there are any cashflow issues with his business or some sort of domestic emergency and he has to borrow, investing the whole £10K in a pension might not be the best idea if the pair of you don't have any 'rainy day' savings to cover such contingencies.

Cooboo

Thanks for that Marcon. He probably earns around £18,000 pa. Would you say a SIPP is what he would have to go for? Are these with banks or is there a government pension scheme for the self employed?

penners324

Numerous companies will do this.

PensionBee, Penfold, Nutmeg, Hargreaves Lawnsdown, etc etc

JoeCrystal

It is also worth checking the State Pension forecast as well.

Dazed_and_C0nfused

JoeCrystal said:

It is also worth checking the State Pension forecast as well.

This ^^^^

Making sure his NI contributions are up to date, Class 2 being the key one for State Pension purposes, is crucial.

xylophone

State Pension Forecast. You may wish to check yours as well.

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

He has a wide choice of pension providers. See

https://forums.moneysavingexpert.com/discussion/comment/79909216/#Comment_79909216

The important thing is to make a start.

MattMattMattUK

Cooboo said:

My husband is in his mid 40s runs his own business and does not have a pension. Has a low income. We have some profit we made from our house sale I want him to invest it in to a pension. We have £10,000. Advice would be so appreciated. 

Cooboo said:

Thanks for that Marcon. He probably earns around £18,000 pa. Would you say a SIPP is what he would have to go for? Are these with banks or is there a government pension scheme for the self employed?

On that basis I think it might actually be worth looking at if the £10k can be invested to grow the business an then put the increased profits into a pension and maximising the tax benefits of doing so. 

Albermarle

Just maybe worth saying that it is very easy to open a new pension online and start contributing.
The only part to be aware of is that you have to decide what investments to use within the pension.
The pension provider can not normally give you any specific advice on this, however they will have guidance and info on their website for those new to investing. 
Although robo providers, like Nutmeg and Wealthify will suggest an investment( s) based on your answers to some questions, in return for paying a little bit higher charge than you would normally.