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    • LEP
    • By LEP 17th Mar 17, 1:50 PM
    • 113Posts
    • 14Thanks
    Any reason to not pay money into a pension?
    • #1
    • 17th Mar 17, 1:50 PM
    Any reason to not pay money into a pension? 17th Mar 17 at 1:50 PM
    If saving long term with an aim for retirement is there any good reason to not put any spare cash into a workplace pension scheme where you get the benefit of salary sacrifice?

    I soon will have £1000/month spare cash and am wondering what to do with it…..I am 42 and am saving enough into a pension to retire fairly comfortably at 60.

    The extra money would benefit from 32% ‘relief’ as it would be taxed at the 20p rate should I take it as pay.

    Should I stick the lot into my pension – the obvious benefit is I could bring my retirement date forward – or not….?
Page 1
    • atush
    • By atush 17th Mar 17, 1:53 PM
    • 16,709 Posts
    • 10,412 Thanks
    • #2
    • 17th Mar 17, 1:53 PM
    • #2
    • 17th Mar 17, 1:53 PM
    Well the main reason not to would be that you dont have other savings and investments to fall back on that are accessible should you need money quickly in an emergency. Or you know that you will need a large sum in the near future (ie before age 55).

    If you do have other finds for the above, then that 32% savings would be very enticing.
    • Aretnap
    • By Aretnap 17th Mar 17, 3:43 PM
    • 2,963 Posts
    • 2,482 Thanks
    • #3
    • 17th Mar 17, 3:43 PM
    • #3
    • 17th Mar 17, 3:43 PM
    (ie before age 55).
    Originally posted by atush
    The OP is 42, so AIUI under current plans he won't be able to access his pension until he's 57 will he? Or has that been shelved for the time being?

    In any event I'd assume that the age at which he'll be able to access it is likely to rise by the time he retires - certainly in the long term it's only going to go in one direction. So if he's hoping to bring his retirement age significantly forward from 60 it would be a good idea to have savings outside his pension to cover any gap between stopping work and accessing his pension (and provide for contingencies along the way).

    That aside, the salary sacrifice certainly makes the pension an attractive option.
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