Pensions?

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jminton
jminton Posts: 1 Newbie
in Pensions, annuities & retirement planning
Hi,

Im 25 Years Old, just about to complete a purchase on my first property. i am self employeed - basic rate tax payer. A little confused with whats out there. Interested in starting a pension pot? Any advise guys?
Much appreciated
Josh

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  • AnotherJoe
    AnotherJoe Posts: 19,622 Forumite
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    Try Pensionwise as a starting place.
    Whilst pensions can seem complex and confusing, and sometimes can be complex and confusing, in essence they are very simple, a savings scheme with tax benefits.

    Think of it like a reverse mortgage. With your new mortgage you will have taken out a big loan and be paying it off gradually over 25 or so years. With a pension, you start off with nothing and hope to build up a big amount over 25+ years that you can then spend down to live off in retirement

    In the case of a self employed person there can be additional tax benefits which you'd need an accountant to advise you on, but in essence yoir company can put money in your pension avoiding you having to pay tax on it.
  • BLB53
    BLB53 Posts: 1,583 Forumite
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    I suggest the best options would be either a SIPP or Robo Adviser. A DIY option is probably cheaper in the long run but is not suitable for everyone. It depends on the time you have to read up on SIPPs and your temperament.

    For starters, have a read of Edwards book 'DIY Pensions'. If it makes sense then look at DIY or if not explore the Robo options such as Moneyfarm and Nutmeg for example.
  • JimmyTheWig
    JimmyTheWig Posts: 12,199 Forumite
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    For what is presumably a low starting balance and reasonably low monthly payment, would a Stakeholder Pension not be better?
  • xylophone
    xylophone Posts: 44,422 Forumite
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    https://www.cavendishonline.co.uk/pensions/stakeholder-and-personal-pensions/aviva/

    might suit as a start.
  • LHW99
    LHW99 Posts: 4,219 Forumite
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    In the case of a self employed person there can be additional tax benefits which you'd need an accountant to advise you on, but in essence yoir company can put money in your pension avoiding you having to pay tax on it.
    Isn't the point of self-employment that you are not running a "company"?
    I thought it was only if you were a director / employee of a limited company that tax (corporation / NI etc) could be saved?
  • Spreadsheetman
    Spreadsheetman Posts: 436 Forumite
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    xylophone wrote: »
    https://www.cavendishonline.co.uk/pensions/stakeholder-and-personal-pensions/aviva/

    might suit as a start.
    Just as an aside - I was curious and looked at that myself a while back just to see how easy it would be for a beginner to start their own pension. The immediate snag I saw was that even this "simple" pension had at least 240 fund choices.

    How is someone without sophisticated knowledge of investments going to be able to manage to make sensible choices from that range?
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