Pension v isa (s&s)

olb81

One or the other of both?
Only difference I can see is its locked away in the pension.
Which might be a good thing for impulsive people?
End aim is an income to replace wages.
Currently age single 44 with 30k pension and 200k instant savings but no property.

eskbanker

They each have their place but pension has tax benefits over ISAs, in terms of the ability to access 25% tax-free, which equates to a 6.25% advantage for basic rate taxpayers both pre- and post-retirement.

ColdIron

olb81 said:

One or the other of both?

Both. They do different jobs

Only difference I can see is its locked away in the pension.

Some obvious differences:
Pensions get tax relief and possible employer contributions (free money) but are taxable upon withdrawal. Many will be able to pay more into a pension 
ISAs get no relief but are tax free upon withdrawal

End aim is an income to replace wages.

That'll be pensions then, however ISAs can be very useful to bridge the gap if you want to retire early

Currently age single 44 with 30k pension and 200k instant savings but no property.

That's a very low pension figure for your age but no property could be a bigger problem. How will you pay for where you live once you stop working? Your pension won't replace your earned income. At 44 you could live another 40 years and cash is badly eroded by inflation

Please say that that £200k is at least partially in an ISA

SnowMan

eskbanker said:

They each have their place but pension has tax benefits over ISAs, in terms of the ability to access 25% tax-free, which equates to a 6.25% advantage for basic rate taxpayers both pre- and post-retirement.

This is a table I produced a while back showing the relative tax difference between SIPPs and ISAs. The 6% figure in the top row is your basic rate in/basic rate out figure for example.

El_Torro

Based on the limited information provided you probably don’t need to concern yourself with Stocks & Shares ISAs too much. By the time you’ve paid off your property (assuming you’re going to buy one) and built up a decent pension pot it’ll be time to retire anyway. 

Depending on where you are in the country and what kind of property you want your cash savings could go a long way towards buying a place to live in. 

Alexland

£200k instant savings and no property is an unusual situation to be in and without knowing your objectives it's hard to comment on investment things to consider. Do you plan to buy property now, later, ever? If you could please let us know how you would like your life to play out and then we can talk about savings and investment choices that might align.

badger09

Alexland said:

£200k instant savings and no property is an unusual situation to be in and without knowing your objectives it's hard to comment on investment things to consider. Do you plan to buy property now, later, ever? If you could please let us know how you would like your life to play out and then we can talk about savings and investment choices that might align.

OP has a complicated relationship with property ownership/living with parents, and has apparently recently sold a property bought September? 2025 for £230k.  

MEM62

olb81 said:

One or the other of both?
Nothing beats a pension for providing for your retirement.  (Far better than an ISA as the money goes in pre-taxation) That is where your retirement money should go.  The ISA is for shorter term goals or for when you have used you full pension allowance.
 
Only difference I can see is it's locked away in the pension.
Then you are not seeing clearly.  

Which might be a good thing for impulsive people?

End aim is an income to replace wages.
Currently age single 44 with 30k pension and 200k instant savings but no property.

A pension is the vehicle for retirement and, at 44 you are way behind the curve with your is you only have £30K in it.  You are far from on target to meet your aim.