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  • FIRST POST
    • pollyanna24
    • By pollyanna24 9th Jan 18, 3:28 PM
    • 3,811Posts
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    pollyanna24
    Workplace Pension
    • #1
    • 9th Jan 18, 3:28 PM
    Workplace Pension 9th Jan 18 at 3:28 PM
    Currently I believe I pay 1% into my work pension as does my employer.

    He has received an e-mail which says that it will go up to 3% (my contribution) and 2% (his contribution in April.

    I know you can opt out of the pension altogether, but can I opt out of any rises?

    I also have a private pension that I pay into (which started before auto enrollment) and was thinking a better course (at the moment as I have young children and two mortgages to pay) might be lowering the amount of the private pension monthly amount.
    Pink Sproglettes born 2008 and 2010
    House Worth (approx) - 400,000
    Mortgages (3rd Nov 2017) - 180,813.85
    Equity - 219,186.15
Page 1
    • TAMB
    • By TAMB 9th Jan 18, 3:33 PM
    • 5 Posts
    • 5 Thanks
    TAMB
    • #2
    • 9th Jan 18, 3:33 PM
    • #2
    • 9th Jan 18, 3:33 PM
    Re your workplace pension, you have two broad options:
    1) Pay the minimum or more (you can't opt to pay less than the minimum)
    2) Opt out completely

    I would think paying into your work pension is better than your personal pension due to the fact that the employer will pay in 2% (this will increase to 3%). Basically free money!
    • pollyanna24
    • By pollyanna24 9th Jan 18, 3:35 PM
    • 3,811 Posts
    • 4,685 Thanks
    pollyanna24
    • #3
    • 9th Jan 18, 3:35 PM
    • #3
    • 9th Jan 18, 3:35 PM
    Re your workplace pension, you have two broad options:
    1) Pay the minimum or more (you can't opt to pay less than the minimum)
    2) Opt out completely

    I would think paying into your work pension is better than your personal pension due to the fact that the employer will pay in 2% (this will increase to 3%). Basically free money!
    Originally posted by TAMB
    Thanks for this. I agree. When the time comes and I'm finding it hard (seeing as the payment is tripling for me), I might reduce down the private one for a while. Thanks again.
    Pink Sproglettes born 2008 and 2010
    House Worth (approx) - 400,000
    Mortgages (3rd Nov 2017) - 180,813.85
    Equity - 219,186.15
    • pollyanna24
    • By pollyanna24 9th Jan 18, 3:37 PM
    • 3,811 Posts
    • 4,685 Thanks
    pollyanna24
    • #4
    • 9th Jan 18, 3:37 PM
    • #4
    • 9th Jan 18, 3:37 PM
    Looking at the payment next year (April 2019) onwards, I might have to think about stopping the private one.

    I'm assuming that what I have in there already will just sit and wait for me to retire? haha. It's not a huge amount, but I have been paying for the last four or five years or so.
    Pink Sproglettes born 2008 and 2010
    House Worth (approx) - 400,000
    Mortgages (3rd Nov 2017) - 180,813.85
    Equity - 219,186.15
    • TAMB
    • By TAMB 9th Jan 18, 3:44 PM
    • 5 Posts
    • 5 Thanks
    TAMB
    • #5
    • 9th Jan 18, 3:44 PM
    • #5
    • 9th Jan 18, 3:44 PM
    Looking at the payment next year (April 2019) onwards, I might have to think about stopping the private one.

    I'm assuming that what I have in there already will just sit and wait for me to retire? haha. It's not a huge amount, but I have been paying for the last four or five years or so.
    Originally posted by pollyanna24
    It will most likely just remaining within the pension wrapper and stay invested. You should be able to restart contributions at anytime.
    • PeacefulWaters
    • By PeacefulWaters 9th Jan 18, 4:14 PM
    • 8,318 Posts
    • 10,655 Thanks
    PeacefulWaters
    • #6
    • 9th Jan 18, 4:14 PM
    • #6
    • 9th Jan 18, 4:14 PM
    Your employer is offering you free money. Prioritise getting that before any additional private pension arrangement you have.

    Are there any circumstances where your employer would contribute more than 2%?
    • atush
    • By atush 10th Jan 18, 10:20 AM
    • 16,802 Posts
    • 10,485 Thanks
    atush
    • #7
    • 10th Jan 18, 10:20 AM
    • #7
    • 10th Jan 18, 10:20 AM
    Have you dont an MSE makeover? Checked you are getting the best deals on insurance/Utilities/phones etc?


    If there is any waste to cut out, you might be able to afford both? When was your last pay rise?
    • pollyanna24
    • By pollyanna24 11th Jan 18, 2:24 PM
    • 3,811 Posts
    • 4,685 Thanks
    pollyanna24
    • #8
    • 11th Jan 18, 2:24 PM
    • #8
    • 11th Jan 18, 2:24 PM
    Thanks for everyone's replies.

    I'm on the lowest I can for everything.

    I chuck any spare money at my mortgages.

    I know that my pension is very important which is why I started my private one. And I will continue paying both as long as I can, but I suppose in my head, my first priority is getting the mortgage payment down as I don't know how long I will be in my current job.
    Pink Sproglettes born 2008 and 2010
    House Worth (approx) - 400,000
    Mortgages (3rd Nov 2017) - 180,813.85
    Equity - 219,186.15
    • greatkingrat
    • By greatkingrat 11th Jan 18, 3:25 PM
    • 101 Posts
    • 90 Thanks
    greatkingrat
    • #9
    • 11th Jan 18, 3:25 PM
    • #9
    • 11th Jan 18, 3:25 PM
    Just to note that the minimum contribution will increase again in April 2019 to 5% employee and 3% employer, so you may want to bear that in mind when planning ahead.
    • kidmugsy
    • By kidmugsy 11th Jan 18, 3:34 PM
    • 10,836 Posts
    • 7,419 Thanks
    kidmugsy
    Just to note that the minimum contribution will increase again in April 2019 to 5% employee and 3% employer, so you may want to bear that in mind when planning ahead.
    Originally posted by greatkingrat
    In which case she might be wise immediately to stop contributing to the private pension and to stop overpaying the mortgage. She could put the money aside for imminent and future contributions to the employer scheme. Free money should be harvested whenever possible.

    If she eventually finds the cost of the employer scheme insupportable then she could return to overpaying the mortgage instead. Or maybe drop out temporarily, save like billy-oh, and then return to it for a while. Even intermittent membership would garner free money. Is jumping in and out allowed?
    Last edited by kidmugsy; 11-01-2018 at 3:44 PM.
    Free the dunston one next time too.
    • pennystretcher
    • By pennystretcher 12th Jan 18, 3:13 PM
    • 386 Posts
    • 1,448 Thanks
    pennystretcher
    Remember that even though your contribution rate will increase you will also get the tax relief on the contributions, so if you can, wait for the first payment to come off your salary to see the actual impact before you change your private pension contributions.

    ps. I assume you have an emergency fund? If not, move the mortgage OPs into that until you have enough put aside - I think general recommendation is 6 months' income somewhere that you can access relatively easily.
    Last edited by pennystretcher; 14-01-2018 at 12:54 PM. Reason: fixed typo
    Mortgage free
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