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  • FIRST POST
    • Tom Brine
    • By Tom Brine 12th Feb 18, 1:02 PM
    • 61Posts
    • 19Thanks
    Tom Brine
    Partners Pension
    • #1
    • 12th Feb 18, 1:02 PM
    Partners Pension 12th Feb 18 at 1:02 PM
    My partner has just started a new job. Its well paid and working from home. The only problem is the pension is 1% contribution from her, matched by a 1% contribution by her employer.

    She has a military pension from 12 years in service and is in her early thirties.

    Obviously the auto enrollment pension savings is no where near enough to ensure she has a suitable amount of money come retirement.

    At her age would people reccommend a SIPP or a stakeholder pension. I am currently looking at Cavendish Online as cheap providers of both for new starters to DC pension saving. However if she takes the SIPP route then she could transfer to Vanguard should their offering be attractive when they launch it this year.

    As a deduction I suggested 8-10% to ensure she starts to build up a good pot. Thoughts or suggestions most welcome
Page 1
    • dunstonh
    • By dunstonh 12th Feb 18, 1:24 PM
    • 92,134 Posts
    • 59,291 Thanks
    dunstonh
    • #2
    • 12th Feb 18, 1:24 PM
    • #2
    • 12th Feb 18, 1:24 PM
    At her age would people reccommend a SIPP or a stakeholder pension.
    or a personal pension or an ISA or an increment to the existing workplace scheme.....
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
    • Thrugelmir
    • By Thrugelmir 12th Feb 18, 1:28 PM
    • 58,173 Posts
    • 51,533 Thanks
    Thrugelmir
    • #3
    • 12th Feb 18, 1:28 PM
    • #3
    • 12th Feb 18, 1:28 PM
    The only problem is the pension is 1% contribution from her, matched by a 1% contribution by her employer.
    Originally posted by Tom Brine
    Minimum contribution rates rise from this April for both employee and employer, and in the following year.

    April 2018 - EE 3% = ER 2% Total 5%

    April 2019 - EE 5% = ER 3% Total 8%
    Financial disasters happen when the last person who can remember what went wrong last time has left the building.
    • Tom Brine
    • By Tom Brine 12th Feb 18, 1:39 PM
    • 61 Posts
    • 19 Thanks
    Tom Brine
    • #4
    • 12th Feb 18, 1:39 PM
    • #4
    • 12th Feb 18, 1:39 PM
    Thanks Thrugelmir.

    The increase will certainly mean a contribution of 8-10% into a separate individual pension combines with 5% total (8% later) to make a 13% to 15% total contribution which is closer to where we would like it to be.

    Dunstonh, thanks for ensuring the alternative options are visible.
    • xylophone
    • By xylophone 12th Feb 18, 2:55 PM
    • 25,119 Posts
    • 14,802 Thanks
    xylophone
    • #5
    • 12th Feb 18, 2:55 PM
    • #5
    • 12th Feb 18, 2:55 PM
    Has she looked into making additional contributions to the auto enrolment scheme?

    Examples

    https://www.nestpensions.org.uk/schemeweb/NestWeb/public/memberhelpcentre/contents/how-can-i-make-additional-contributions.html

    https://thepeoplespension.co.uk/help/knowledgebase/whats-additional-voluntary-contribution/

    https://www.nowpensions.com/help-centre/faqs/contributions/can-an-employee-pay-more-in-to-the-pension-pot-than-the-employer
    • kidmugsy
    • By kidmugsy 12th Feb 18, 4:07 PM
    • 10,346 Posts
    • 7,041 Thanks
    kidmugsy
    • #6
    • 12th Feb 18, 4:07 PM
    • #6
    • 12th Feb 18, 4:07 PM
    It might be worth seeing whether a LISA appeals. The money isn't available penalty-free until she's 60, but then she can withdraw it tax-free. And her contributions get a 25% boost from the taxpayer i.e. her annual max 4k -> max 5k.

    P.S. That's about the LISA as a savings vehicle for old age. If she's never owned a residential property she can also use it for saving towards a deposit, so that she can withdraw it penalty-free, subject to constraints on the cost of the house.
    Free the dunston one next time too.
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