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    • madlyn
    • By madlyn 6th Jul 18, 10:54 AM
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    madlyn
    ex employer pension
    • #1
    • 6th Jul 18, 10:54 AM
    ex employer pension 6th Jul 18 at 10:54 AM
    I currently pay into a private pension with AEGON, my current employers pension 3% a month and I also have a pension from my previous empolyer that I have not payed into since I left in April of last year.
    Is it worth me starting to pay into this again? I can afford to pay in around 20 a month which I know is not enough but is what I can afford.
    And I am 43
Page 1
    • MallyGirl
    • By MallyGirl 6th Jul 18, 11:11 AM
    • 2,954 Posts
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    MallyGirl
    • #2
    • 6th Jul 18, 11:11 AM
    • #2
    • 6th Jul 18, 11:11 AM
    you need to look at what the 2 pensions are invested in before you can judge that.
    Does your current employer do salary sacrifice - if so then it would be better to invest more with that one. Are you contributing enough to get the max contribution from your employer (free money)?
    • madlyn
    • By madlyn 6th Jul 18, 11:30 AM
    • 626 Posts
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    madlyn
    • #3
    • 6th Jul 18, 11:30 AM
    • #3
    • 6th Jul 18, 11:30 AM
    My current employers pension is through salary sacrifice, so I would be better perhaps increasing from 3% to 4% that way my employer matches that and it comes straight out of my wages which I wont notice?
    • MallyGirl
    • By MallyGirl 6th Jul 18, 11:32 AM
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    MallyGirl
    • #4
    • 6th Jul 18, 11:32 AM
    • #4
    • 6th Jul 18, 11:32 AM
    and you don't pay NI on the amount sacrificed so that is another 12% of the amount as a boost.

    Does your employer have an upper limit on what they will match?
    • madlyn
    • By madlyn 6th Jul 18, 11:45 AM
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    madlyn
    • #5
    • 6th Jul 18, 11:45 AM
    • #5
    • 6th Jul 18, 11:45 AM
    The limit I can pay is 6% and the most my employer will pay is 5%
    • tacpot12
    • By tacpot12 6th Jul 18, 12:32 PM
    • 1,367 Posts
    • 1,177 Thanks
    tacpot12
    • #6
    • 6th Jul 18, 12:32 PM
    • #6
    • 6th Jul 18, 12:32 PM
    You really need to pay the most you can into your employer's scheme. Even with their contribution, you are still only paying in 11% of your salary into your pension. On the face of it, as you currently live on 97% of your salary, if you save at the rate of 11% per year, you will need to save for 8 years to have one year's income in retirement! Luckily this is not correct, because usually by the time you retire you don't need anything like your current salary to live on. Depending on circumstances, you might need 50-65% of your current salary, so you only need to save for 5.5 years per year of retirement. Doubling the amount you save, will halve the amount of time you have to work to have one year in retirement. The performance of your investments will also have a big impact, and will reduce the number of years you need to work down by a good amount. The State Pension also has a very big impact on this, so don't worry too much. I was just trying to demonstrate that 11% is not a lot in pension savings. I had a generous employer and I used to contribute 13.5% that they 'matched' with 10%, so I was paying 23.5% of my salary into my pension each year.

    Please take a moment to review your outgoings to see if there is anyway that you can pay more than 5% (before tax) into your pension. If you can, you might need to setup a personal pension for the excess that your employer will not let you contribute via their payroll, or have a look at you old employers penson to see if has low charges, good investment performance and will allow you to restart payments (as an old employer's scheme it may not allow you to add any more money). If so, you need to find out how much is in that scheme, and compare the charges and performance with any new scheme to see if it is worth transering the money in this old scheme to a new pension.
    • MallyGirl
    • By MallyGirl 6th Jul 18, 12:32 PM
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    MallyGirl
    • #7
    • 6th Jul 18, 12:32 PM
    • #7
    • 6th Jul 18, 12:32 PM
    In that case I would try and make sure that I was contributing enough to get the employer 5%. (as a bare min).
    • madlyn
    • By madlyn 6th Jul 18, 1:30 PM
    • 626 Posts
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    madlyn
    • #8
    • 6th Jul 18, 1:30 PM
    • #8
    • 6th Jul 18, 1:30 PM
    In my old employers pension I have around 6.5k and in the last year they charged me around 2.50
    • MallyGirl
    • By MallyGirl 6th Jul 18, 1:41 PM
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    MallyGirl
    • #9
    • 6th Jul 18, 1:41 PM
    • #9
    • 6th Jul 18, 1:41 PM
    what you need to do is see what each is invested in - the old one might be similar to the new one or completely different. Only then can you decide what to do - or not do - with the old one.
    You might be able to transfer the old one into the new one - makes for a simple life but the new provider may not let you.
    Or you just leave it where it is and collect the 250 per year that it might generate once you reach the retirement age for it.
    • madlyn
    • By madlyn 6th Jul 18, 2:03 PM
    • 626 Posts
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    madlyn
    The old one is ran by Legal & General for M&S and if I remember correctly once you had been paying into your pension for 3 years, if you ever left you were unable to transfer to another pension. I left after 4 years.
    • xylophone
    • By xylophone 6th Jul 18, 2:17 PM
    • 26,486 Posts
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    xylophone
    Have you enquired about a transfer in to your new pension?
    • Brynsam
    • By Brynsam 6th Jul 18, 2:38 PM
    • 1,568 Posts
    • 1,137 Thanks
    Brynsam
    The old one is ran by Legal & General for M&S and if I remember correctly once you had been paying into your pension for 3 years, if you ever left you were unable to transfer to another pension. I left after 4 years.
    Originally posted by madlyn
    That doesn't sound right. You normally have a statutory right to transfer at your age. Check.
    • madlyn
    • By madlyn 30th Aug 18, 11:11 AM
    • 626 Posts
    • 103 Thanks
    madlyn
    So, after lots of phone calls and e-mails this is my pension situation now.
    I pay 3% of my monthly wage into my pension fund and this is matched by my employer.
    I have increased my monthly payments into my private pension.
    My ex employer pension from M&S is not open to new money being paid into it, I can move it to my private pension but the fund I pay into does not accept new money either, so I would need to pick a fund to pay into. This for me was way to confusing and as I'm under 55 I cannot cash the pension in so it is sitting with the pension provider doing it's thing.
    • cloud_dog
    • By cloud_dog 30th Aug 18, 12:42 PM
    • 3,840 Posts
    • 2,281 Thanks
    cloud_dog
    So, after lots of phone calls and e-mails this is my pension situation now.
    I pay 3% of my monthly wage into my pension fund and this is matched by my employer.
    I have increased my monthly payments into my private pension.
    My ex employer pension from M&S is not open to new money being paid into it, I can move it to my private pension but the fund I pay into does not accept new money either, so I would need to pick a fund to pay into. This for me was way to confusing and as I'm under 55 I cannot cash the pension in so it is sitting with the pension provider doing it's thing.
    Originally posted by madlyn
    Why?

    I thought your current employer would match contributions up to 5% (?), and also are you able to benefit from salary sacrifice?
    Personal Responsibility - Sad but True

    Sometimes.... I am like a dog with a bone
    • kidmugsy
    • By kidmugsy 30th Aug 18, 12:47 PM
    • 11,580 Posts
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    kidmugsy
    I pay 3% of my monthly wage into my pension fund and this is matched by my employer. I have increased my monthly payments into my private pension.
    Originally posted by madlyn
    For the reasons explained earlier, this is a poor decision. You'd get far better value for money by increasing your contributions to your scheme at work instead.

    My ex employer pension from M&S ... as I'm under 55 I cannot cash the pension in so it is sitting with the pension provider doing it's thing.
    Originally posted by madlyn
    That's probably fine. Be sure to keep them up to date with your address and marital status. By the way, is the M&S pension a "DB" pension, for example a Final Salary pension?
    Free the dunston one next time too.
    • madlyn
    • By madlyn 30th Aug 18, 12:57 PM
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    • 103 Thanks
    madlyn
    My employer pension is done through salary sacrifice, I pay 3% and they match it. The window in which I can change my contributions only opens once a year in January I believe. If come next Jan I am in a position to increase my contributions I will.
    I am fully aware that I should pay as much as possible in to my pension, but I do have other responsibilities so I pay what I can afford.
    • xylophone
    • By xylophone 30th Aug 18, 1:07 PM
    • 26,486 Posts
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    xylophone
    By the way, is the M&S pension a "DB" pension, for example a Final Salary pension?
    I think you had to have joined M&S well before four years ago to be a member of the DB Scheme?

    This is probably the OP's scheme.

    https://www.legalandgeneral.com/workplacebenefits/microsites/marksandspencer/#
    • madlyn
    • By madlyn 30th Aug 18, 1:27 PM
    • 626 Posts
    • 103 Thanks
    madlyn
    I believe the M&S pension is a defined contributions plan
    • xylophone
    • By xylophone 30th Aug 18, 2:24 PM
    • 26,486 Posts
    • 15,725 Thanks
    xylophone
    The old one is ran by Legal & General for M&S and if I remember correctly once you had been paying into your pension for 3 years, if you ever left you were unable to transfer to another pension. I left after 4 years.
    According to the booklet in link in my post above (page 18) if you joined before 1 October 2015

    2. completed more than two years’ membership, you can either:
    • leave your Savings Pot invested in the Plan until you decide to take
    your benefits. You won’t be able to make any new contributions but
    you’ll be able to continue investing in the range of funds available
    to you and you’ll have the same retirement options.

    • transfer the full value of your Savings Pot to another Registered
    Pension Scheme.


    Had you considered a transfer to your private pension with Aegon?
    • madlyn
    • By madlyn 30th Aug 18, 2:45 PM
    • 626 Posts
    • 103 Thanks
    madlyn
    I have considered this, but the money I was planning on moving would not be invested into the same fund as my current pension with Aegon, so I would need to choose another fund. They e-mailed me a link with the available funds and there must have around 70 to choose from. So to avoid choosing the wrong fund and possibly losing money I decided not to move the M&S money.
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