Government Pension Scheme

Barney2004

Barney2004

Vital 1st Team Regular
Boss told me the other day that the Government are introducing a pension scheme. Its up to us if we wish to opt out.

The payment will be 3% of your wage each month., I don't know much about how pesion schemes work, and need to start thinking about it soon as im getting old. lol.

Is it better to do this?, or just calculate what 3% of what my wage is each month and put that into a separate savings account? where I know I will get every penny when I get older.....?

help.
 
I've had a private pension scheme since I was 18, also have a good company scheme, and the missus has a final salary NHS pension. Plus property investment.

Knowing my luck I'll peg it before I retire.
 
do people get all of their pension when they get old?

am I better of just putting my money that I would put into a pension just into a savings account? Because then I know that no one can fuck around with it, or invest it into some bull shit that fails.,..
 
People would argue that it's not worth it at the moment I think - you dont get much back on savings or pensions in the current climate. You'd be better off investing it elsewhere (property, shares)

But then in 30-40 years time things will have changed again, several times, so whatever you invest in should be sound enough, just so long as you invest in something.

I know with mine I get options of lump sums and balance of the rest paid monthly.
 
I think for the moment im going to put it into my spare account, where no one but myself can touch it... and then decide what to do with it in the future. Rather than give it to a government that one day will turn round to me and could possibly tell me im only getting £15 a week from my pension... I don't trust the government one bit.
 
You'd be better off with a pension than a savings account I think, providing you dont need to access the money in the near future.
 
I just don't trust them mate... I rang one and they wanted me to give £75 a month and they said that when I retire they would give me £12.50 a week!! ... then if I die then no one gets the money, none of my family etc.

I think if I put it all into a high interest savings account to begin with until I understand a bit more about pension schemes that would be better...
 
The banks offer pension schemes mate - best thing is to speak to these independent advisors.

My advice would be to pay as much of your mortgage off as you can, and get it paid as quickly as you can. Pool your money with the missus and get it done. Then when that is cleared review your options: flog it and invest the equity, invest in property again, put it in saving etc... (depending on the climate at the time).

We're knocking 8 years off our mortgage by keeping up a high repayments following the renewal, in doing this each time we renew we're hoping to get it paid ASAP - then we will sell and invest or start again. We were lucky when we brought as we have gained a lot of positive equity.

A lot of it comes down to luck with investments and timings I think. But if you want to play it safe and know what your getting then a solid low risk pension is a good idea. Thats why I have one, so it's always there to fall back on.
 
i'll have to look into it a lot more than what I have. For the moment I will bung it all into my savings and when I've got time I will have a word with my bank and see what they can offer/come up with.

I just don't want to get scammed with it and lose money...
 
Barney - get the pension mate. You get some of you tax back into it so you don't pay the full 3%, and your employer will have to pay into it as well. You won't get either of these unless you pay the 3%, and it is worth it. If you die, you nominate someone to get the whole fund.

PM me if you need any details on a more personal level.
 
heathfield, ive heard the government want to invest this money... what if whatever they're investing it into goes tits up?
 
Barney2004 - 12/2/2014 11:16

heathfield, ive heard the government want to invest this money... what if whatever they're investing it into goes tits up?
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No, they don't invest it, it's invested on your behalf. At your age you need to be looking long term anyway, so a riskier portfolio isn't a bad thing. It will probably be a mix of Stocks and Shares (UK and International) as well as some Bonds.

These workplace pensions are a good thing. Assuming you are a basic rate tax payer, and your employer will match your 3% (some might pay more), you get 6% of you salary invested, but it only costs you 2.4%.

It's a no brainer.
 
Barney2004 - 12/2/2014 11:25

cheers buddy.... im going to have a think about it...
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OK mate. Good luck. You should get more details over time, and they will tell you where they are going to invest it. You are also protected under the Financial Services Compensation Scheme, so you are pretty well covered. It's free money!!!!
 
we are having a meeting about it soon so I will know a bit more than what I know about it now so then I should be able to make my mind up :35:
 
Got a couple of decent financial advisor contacts if you ever need Barney. Well worth talking it over with one of them, both Villans as well!
 
cheers JF. Appriciate that mate. Im gonna see what they say in the meeting and then decide what to do after that... so I may need to speak to someone away from the company...
 
never trust anyone but independents is my mantra!

But yes, good call to have meeting first!
 
Usually an Independent Adviser is the best option, but in this case it might not be needed. These schemes have limits on charges, and are heavily monitored. Basically, you can't get any better. The low cost has it's downside, though, in that there just isn't the scope for individual advice. The fees for such would negate the advantage of these schemes.

I doubt that many advisers will be interested in this market, as it is very specialised and the returns are limited.
 
Surely your company will do what is right and best for it's employers. There should be no need to seek independent advice.

We have an advisor come in regulalarly to talk over our schemes and answer any questions, and we get a detailed annual statement showing where the fund is invested and how it is progressing.

Like heath says (clearly more knowledgable on it than i am) it's a no brainer. Everyone I have spoken to about it cannot encourage enough having a pension.

I pay 4% into mine, which from my memory is more than matched by the company. I dont notice it going out of my salary and it just builds up over time - and is transferable if/when I move jobs.
 
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