We'd like to remind Forumites to please avoid political debate on the Forum... Read More »
📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!
Why would someone want to opt out from a pension scheme?
Options
Comments
-
Albermarle said:Probably worth pointing out as I do not think anyone has specifically mentioned it yet, is that some ( mainly larger) private sector employers actually pay more than the minimum required . I think that a contribution of up to 10% is not that uncommon ( sometimes linked to you adding more, but not always) .
So by opting out in this situation you are losing out on even more free money.......Gettin' There, Wherever There is......
I have a dodgy "i" key, so ignore spelling errors due to "i" issues, ...I blame Apple0 -
I opted out of my pension scheme for one month, and then rejoined. this preserved my previous service when i was acting up as my final salary.0
-
GunJack said:Albermarle said:Probably worth pointing out as I do not think anyone has specifically mentioned it yet, is that some ( mainly larger) private sector employers actually pay more than the minimum required . I think that a contribution of up to 10% is not that uncommon ( sometimes linked to you adding more, but not always) .
So by opting out in this situation you are losing out on even more free money.
However 15% is certainly on the high side !0 -
Emmia said:JohnBravo said:Hi,Why would someone want to opt out from a pension scheme?
When you opt out you lose 1% from the government and 3% from the employer, right?
It's a really short sighted approach, but I can see that if you're young or in a situation with pressure on the household budget it is a tempting choice.
it might be shortsighted but it’s financial good sense to try and pay off debts before saving
The greatest prediction of your future is your daily actions.1 -
dont_use_vistaprint said:Emmia said:JohnBravo said:Hi,Why would someone want to opt out from a pension scheme?
When you opt out you lose 1% from the government and 3% from the employer, right?
It's a really short sighted approach, but I can see that if you're young or in a situation with pressure on the household budget it is a tempting choice.
it might be shortsighted but it’s financial good sense to try and pay off debts before saving
It makes no sense if you have a couple of grand on a 0 percent balance transfer and you are giving up a 2:1 employer match.
Or you are making mortgage overpayments but are in the 60 PC marginal tax bracket.
Everything depends on individual circumstances but there are many examples where debt and retirement saving can rationally co-exist."Real knowledge is to know the extent of one's ignorance" - Confucius0 -
dont_use_vistaprint said:Emmia said:JohnBravo said:Hi,Why would someone want to opt out from a pension scheme?
When you opt out you lose 1% from the government and 3% from the employer, right?
It's a really short sighted approach, but I can see that if you're young or in a situation with pressure on the household budget it is a tempting choice.
it might be shortsighted but it’s financial good sense to try and pay off debts before saving
https://www.telegraph.co.uk/money/pensions/thousands-civil-servants-throwing-away-gold-plated-pensions/0 -
Too many people can only see short term gains, they are unable to delay gratification, they see a tiny boost in income now as better than something in the future because they lack the mental capacity to effectively evaluate the abstract concept of future wellbeing.4
-
MattMattMattUK said:Too many people can only see short term gains, they are unable to delay gratification, they see a tiny boost in income now as better than something in the future because they lack the mental capacity to effectively evaluate the abstract concept of future wellbeing.0
-
Maybe, when people opt out and end up with a reduced pension when they retire, they should then complain they weren't written to personally to inform them of their error and claim compensation. MSE will champion their cause.9
-
When our DB closed in 2021 I calculated the ‘loss’ of around £300k between the ages of 52-65, not that I’m working to 65. Their contributions were equivalent to 48% of my wage. They paid £20k transition payment and now do double match to 12% max. I do 25%, so 37% total.
I see being in a company scheme (with company contributions) a no brainer, although I am sure so are on the breadline from a net affordability perspective.
They closed it to new members in 2010, so I always saw the last ten years as a bonus.
Our minimum wage is around £30k to give the option of 6% pension, share scheme and healthcare, whilst remaining above the NMW.0
Confirm your email address to Create Threads and Reply

Categories
- All Categories
- 351K Banking & Borrowing
- 253.1K Reduce Debt & Boost Income
- 453.6K Spending & Discounts
- 244.1K Work, Benefits & Business
- 599K Mortgages, Homes & Bills
- 177K Life & Family
- 257.4K Travel & Transport
- 1.5M Hobbies & Leisure
- 16.1K Discuss & Feedback
- 37.6K Read-Only Boards