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should i set up my own pension or go with my employer?
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Posts: 60 Forumite
I'm 30 and haven't set up a pension yet :wall: - I was self-employed.
I'm starting a new job next month and will be working via an umbrella company. They informed me that i'll start paying into a pension in three months time as it is required by government.
This is better than I've been doing so far, but I'm just wondering if it would be better to get a financial adviser to set me up with my own pension. I know this will cost me at least £600, but i'm concerned that i'll be getting a smaller return because I've taken the easy route, as opposed to higher returns for getting my pension better invested. (Like eating at a Wimpy because it's the first thing you see, rather than doing some research and getting a nicer meal at a Michelin Star restaurant (I haven't eaten at either of these)).
Any advice will be greatly appreciated.
I'm starting a new job next month and will be working via an umbrella company. They informed me that i'll start paying into a pension in three months time as it is required by government.
This is better than I've been doing so far, but I'm just wondering if it would be better to get a financial adviser to set me up with my own pension. I know this will cost me at least £600, but i'm concerned that i'll be getting a smaller return because I've taken the easy route, as opposed to higher returns for getting my pension better invested. (Like eating at a Wimpy because it's the first thing you see, rather than doing some research and getting a nicer meal at a Michelin Star restaurant (I haven't eaten at either of these)).
Any advice will be greatly appreciated.
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Comments
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This is better than I've been doing so far, but I'm just wondering if it would be better to get a financial adviser to set me up with my own pension.
Or just use the workplace scheme and pay extra into that as you are now behind.but i'm concerned that i'll be getting a smaller return because I've taken the easy route, as opposed to higher returns for getting my pension better invested.
To be honest, it doesnt matter what the returns are on the fund until you get the balance into 5 digits. So, it would be a lot of work for no real benefit. Stick with the simple option for now.
Shame about Wimpy. By far the best burger out of the lot but hardly any left.(Like eating at a Wimpy because it's the first thing you see, rather than doing some research and getting a nicer meal at a Michelin Star restaurant (I haven't eaten at either of these)).I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
Or just use the workplace scheme and pay extra into that as you are now behind.
Is this something that I would need to sort myself? Or would an umbrella company look in to this?To be honest, it doesnt matter what the returns are on the fund until you get the balance into 5 digits. So, it would be a lot of work for no real benefit. Stick with the simple option for now.
That's very helpful to know. ThanksShame about Wimpy. By far the best burger out of the lot but hardly any left.
I'll give them a try next time i find one!0 -
Is this something that I would need to sort myself? Or would an umbrella company look in to this?
The umbrella company will auto-enrol you and you can choose to pay more.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
Go with the employer pension as they will be contributing something to it and you don't want to pass up free money“So we beat on, boats against the current, borne back ceaselessly into the past.”0
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As a very rough rule of thumb, you need to have a percentage of salary going into your pension the equivalent of 'half your age' - based on the age when you start paying into your pension. So if starting at 30, you should aim for the combination of what you are contributing and what your employer is contributing to be 15% of your gross salary. So if your gross annual salary is £25,000 (for example) then between you and your employer you should be putting just over £310 a month into pension. It sounds like a lot, but once you have started, you quickly adapt and you have the benefit of tax allowance, so the impact on take home pay is not as great. Make sure you stick with the 15% rule (because you are starting at 30) as you get pay rises.
Good luck and don't fret about the 'late' start - there are plenty of people who don't smell the coffee until much later in life!"For every complicated problem, there is always a simple, wrong answer"0 -
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Worth doing the workplace pension and contributing enough to get maximum employer contribution. In terms of further contributions to catchup it depends on your tax rate on if a pension or S&S Lifetime ISA would be better.
+1 for Wimpy in the 80s great times.
Alex0
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