Personal pensions - Do you pay into one?

[HappyHippyDad]

I have a pension with the NHS, but it is small and not enough. Now I am self employed its time I thought about a personal pension. I have just started paying into one, Vanguard target retirement fund.

I just wondered if those of you who are self employed pay into a personal pension, and if so which one have you chosen and why?

With the Vanguard, it had a reasonable management charges and platform fees and had performed well for quite a few years. Having no other knowledge about pensions that was all i had to go on. However, you can open as many pensions as you like, so I thought I'd ask on here and see what you guys do?

 

[Zerax]

I have a SIPP that I pay into. Gives me total control over what I invest in and has very low charges.

 

[mattg4321]

I let my IFA deal with it for me. He’s made most of my family consistently higher gains than most of the funds. It’s hard work to find a good one though

 

[HappyHippyDad]

I have a SIPP that I pay into. Gives me total control over what I invest in and has very low charges.

Which one is it Zerax?

 

[7029 dave]

I am worried Rishi Sunak is talking about raiding the state pension pot to help pay for this bloody mess we are in.

 

[mattg4321]

They’ll rape you for a second house soon enough I’m sure of it. Landlords have been getting a worse and worse deal for a while now. With the growing numbers of renters it’s no longer political suicide for even the tories to shaft them.

Airbnb seems like it’s next on the hit list too as local opposition will only grow. It’ll be a crowd pleaser to hit these people hard.

The best way to make money tax free is in your primary property if possible. Buy the worst house on the best road and do it up and move on. It’s crap living on a building site though and you’ll probably need to do a lot yourself to make it really pay. The demand for good quality property (read good location) is through the roof currently though with lots of competition.

Best case scenario is you can buy nearer the top of the market as you then have much less competition.

 

[FatAlan]

Be very careful with any pension pots. There are a lot of scammers targeting people since the regulations were relaxed. They'll cash them in with the promise of higher returns when actually they just transfer it off shore, launder it a bit and the use it to invest in their own property, fast cars and gambling.

 

[DPG]

I've had a Scotish Widows stakeholder pension for a few years now and the growth rates per year are very very good.

 

[Zerax]

Which one is it Zerax?

I use AJ Bell but there are several SIPP providers out there. It's all online... I pay whatever I want into it (subject to earning income limits) then the tax grossing up amount arrives in April/May. I can buy and sell almost whatever investments I like in there. Super flexible and super easy... but you'll need to know what you're doing... because you could lose it all !

 

[SJD]

I also use AJ Bell, and only invest in ETFs (exchange traded funds) on the platform. At the time of choosing (about 10 years ago) they seem to have the lowest charges for what I expected to do, a decent range of funds to invest in (though I only use passive ETFs), a good online interface (I can buy & sell ETFs in real time, none of this daily unit pricing nonsense) and a good reputation.

 

[Dustydazzler]

I've had a Scotish Widows stakeholder pension for a few years now and the growth rates per year are very very good.

both my parents were with Scottish widows and both did really well from it

 

[Dustydazzler]

I am worried Rishi Sunak is talking about raiding the state pension pot to help pay for this bloody mess we are in.

I’m 42 and I’m pretty sceptical that I will even receive a single penny in state pension before I die

 

[plugsandsparks]

Have Sipp invest in funds, shares and cash

 

[Gavin John Hyde]

I have my own sipp which my ltd comapany pays into - couple thousand a year, it reduces corporation tax liability and is not subject to income tax either. I also make a notional payment each month into the SIPP - with the tax relief and other benefits of running my own company it works out really well. Mine is with Hargreaves Lansdown, Initially chose the funds myself and over 5 years it is up 61% despite pandemic and brexit etc...
As its grown I am now going to speak to a financial advisor I know to see if it needs tweaking.

 

[Deleted account]

When loads of peeps lost a big part if not all there pensions a few years ago due to fraud. I stopped paying into a private pension. What guarantee is there that all that money will still be there when you retire.
This wasn’t a case of stock market values dropping. It was actual fraud. Th3 peeps never got there pensions.

instead of a pension ive invested in property. Paid my own mortgage off early and invested in 2 other rental properties.
im getting returns now before my official retirement in the form of rent and massive capital gains.
The rental income has gone up from £570 per month to £800 per month in the last 9 years On one of my properties.

also I’ve gained about £200,000 in capital gains in the last nine years.

I say scrap the pensions. Buy property. Don’t trust the IFA , the pension scemes or stock market investors.

 

[LukeD]

I have a pension with the NHS, but it is small and not enough. Now I am self employed its time I thought about a personal pension. I have just started paying into one, Vanguard target retirement fund.

I just wondered if those of you who are self employed pay into a personal pension, and if so which one have you chosen and why?

With the Vanguard, it had a reasonable management charges and platform fees and had performed well for quite a few years. Having no other knowledge about pensions that was all i had to go on. However, you can open as many pensions as you like, so I thought I'd ask on here and see what you guys do?

I dont waste my time . A client did the maths years ago and said that unless a 35 year old is paying in £1k a month its not going to be worth it .let alone the risks of the money going missing

 

[DPG]

I dont waste my time . A client did the maths years ago and said that unless a 35 year old is paying in £1k a month its not going to be worth it .let alone the risks of the money going missing

Depends on how much you want out of it really. If someone pays £1000 from age 35 to age 68 and gets a decent growth rate, then that's a pretty reasonable pension pot. Combine that with state pension, part time job and maybe other savings/property income then you could do OK. You won't have a mortgage to pay by then all being well.

And don't forget things are more flexible now. You aren't forced to buy an annuity for the whole pot. There are options to take a percentage as a lump sum. And you have a much wider choice of how old you are when you cash it in.

 

[LukeD]

A 35 year old paying a mortgage and £1k a month sure is going to earning a lot ! factor in a family etc then they might need at least £5 a month to make it easy enough . Thats one large income .

 

[DPG]

A 35 year old paying a mortgage and £1k a month sure is going to earning a lot ! factor in a family etc then they might need at least £5 a month to make it easy enough . Thats one large income .

Indeed. And I pay nowhere near that. I suspect whoever said you would need to pay that much in either got their sums wrong or was wanting very opulent retirement.

 

[LukeD]

Indeed. And I pay nowhere near that. I suspect whoever said you would need to pay that much in either got their sums wrong or was wanting very opulent retirement.

Comfortable I would imagine .

 

[DPG]

Comfortable I would imagine .

Very.

 

[Dustydazzler]

I was always told that you were better off starting a pension fund when you were young and paying in little and often.

I wouldn’t have the spare cash now to be ploughing in a grand a month

how many youngsters today are starting a private pension fund I wonder ? I bet it’s not manyn

 

[DPG]

I was always told that you were better off starting a pension fund when you were young and paying in little and often.

I wouldn’t have the spare cash now to be ploughing in a grand a month

how many youngsters today are starting a private pension fund I wonder ? I bet it’s not manyn

Absolutely. The benefits of starting one younger are huge. The longer you leave it the harder it is to build that pot up.

 

[Zerax]

Absolutely. The benefits of starting one younger are huge. The longer you leave it the harder it is to build that pot up.

Totally agree... I'd say it was vital for all youngsters to allocate a certain %age of their pay to a pension... and stick to it !! There are all sorts of pension arrangements you can make these days, there's really no excuse for not making provision for your own old age.

 

[Gavin John Hyde]

If you are on the books you have to manually opt out as the employer has to auto enrol you. And contribute i think minimum of 3% of your salary into it.

 

[Gavin John Hyde]

If you are coming upto retirement age now. You could work part time doing eicrs and make a nice amount. Not huge sums but certainly supplement any state or private pension.
That said i know an old guy who took a job in waitrose on the tills for 20 hours a week. Loves it. Pay isnt too bad considering and he gets discount so his wife is happy

 

[andyb]

I am worried Rishi Sunak is talking about raiding the state pension pot to help pay for this bloody mess we are in.

There is no pension pot to raid, the state pension is paid from taxes.
It's been reported that he's considering reducing the lifetime allowance to £800K, probably doesn't concern anyone here. Or, reducing the higher rate tax allowance from 40% to 20%, long overdue IMO, or introducing an employer's tax on pension contributions.

 

[Dustydazzler]

I also think people of our generation want a much more lavish retirement? So will have to make provision for it personally?

when I think back to my grandparents their retirement was very very different, they lived in an old bedsit council flat, they had no car and never went on holiday. They both drew a state pension, neither had any private income. I still remember vividly they had an old biscuit tin under the bed stuffed full of five and ten pound notes my grandfather saved up. They both lived off this cash until they eventually both died. They had nothing in the way of assets other than the old furniture in the flat and the tv. Even their washing machine was rented from the council.

 

[DPG]

I also think people of our generation want a much more lavish retirement? So will have to make provision for it personally?

when I think back to my grandparents their retirement was very very different, they lived in an old bedsit council flat, they had no car and never went on holiday. They both drew a state pension, neither had any private income. I still remember vividly they had an old biscuit tin under the bed stuffed full of five and ten pound notes my grandfather saved up. They both lived off this cash until they eventually both died. They had nothing in the way of assets other than the old furniture in the flat and the tv. Even their washing machine was rented from the council.

Absolutely. A lot of people these days aren't content unless they have the latest stuff and 3 foreign holidays year.

And don't forget, the pension system was fine back then, when a lot of people didn't live much longer than retirement age. But with healthier lifestyles and better healthcare/treatments etc it's not at all uncommon to live into your 90s now.

 

[i=p/u]

Watever will be will be, and probably never stop working til ya clunk it. I dont worry about this stuff.
And why most people opt out is cause the minimum wage is low enough never mind another 30 comming out per week... was stupid move to say we've fixed a problem but ya can opt out..

 

[pc1966]

I have some pension in one scheme via previous university employment, and some via a private pot for when I was a one-man company. I doubt either will pay me much, but I suspect I won't have huge costs then either.

I would say diversity, have a pension scheme but if you can also have some money put in property (as suggested above) if you can do stuff up in your 'spare' time and have tradesfolk you trust not to rip you off for the stuff you can't do.

 

[D Skelton]

If you start investing at the age of 30 just £100 per month in a relatively safe and diversified ETF with a conservative average annual growth rate of just 15%, by the time you're 60 you'll have over half a million pounds.

 

[Zerax]

There is no pension pot to raid, the state pension is paid from taxes.
It's been reported that he's considering reducing the lifetime allowance to £800K, probably doesn't concern anyone here. Or, reducing the higher rate tax allowance from 40% to 20%, long overdue IMO, or introducing an employer's tax on pension contributions.

Or... if he really wants to sort things out... he should overhaul the public sector gold plated pensions system. I know so many people that have retired at 50 (or thereabouts) with a massive lump sum and gratuitous pension. How can it be right for someone to receive a pension for more years than they actually worked for ??? It's crazy.

 

[rapparee]

I'm putting in just over £50 a week and my employer is putting in half that.

I have bits of pots here there and everywhere, I really need to get round to consolidating everything into the one.

 

[Deleted account]

I'm putting in just over £50 a week and my employer is putting in half that.

I have bits of pots here there and everywhere, I really need to get round to consolidating everything into the one.

I looked into the consolidation as I have two old pensions floating around. I was informed that it was not viable as the fees to do so would eat into the pension.

 

[DPG]

I looked into the consolidation as I have two old pensions floating around. I was informed that it was not viable as the fees to do so would eat into the pension.

Same here for a small pot that I've got. Advisor said fees would be excessive compared to the fund value.

 

[pc1966]

Same here for a small pot that I've got. Advisor said fees would be excessive compared to the fund value.

I had been wondering about that myself and suspected it would not be worth it, so useful to know.

 

[telectrix]

You aren't forced to buy an annuity for the whole pot. There are options to take a percentage as a lump sum. And you have a much wider choice of how old you are when you cash it in.

i found this out. 6 months after Mrs. Tel cashed in a pension ( 25% lump, rest a bloody annuity), the return on the annuity means she''ll need to live to 140 just to get her money back. bloody scam.

 

[SJD]

Re charges for transferring, are these exit penalties from the original provider. or fees from an "advisor" for arranging a transfer? Exit penalties sometimes exist especially on older schemes, and you can't do much about. Advisor fees you can maybe do the admin yourself with no fee, unless perhaps an old final salary (defined benefit) scheme where "advice" is mandatory before a transfer can be accepted.

 

[DPG]

Re charges for transferring, are these exit penalties from the original provider. or fees from an "advisor" for arranging a transfer? Exit penalties sometimes exist especially on older schemes, and you can't do much about. Advisor fees you can maybe do the admin yourself with no fee, unless perhaps an old final salary (defined benefit) scheme where "advice" is mandatory before a transfer can be accepted.

Must admit I can't remember. I'm due a pension review so when I get it booked in I'll find out.

 

[SJD]

Must admit I can't remember. I'm due a pension review so when I get it booked in I'll find out.

If you have all the original paperwork from when you joined the old scheme (hopefully yes!), then careful reading should reveal anything like exit penalties. If you get a paid advisor to review it for you, I suppose it is only fair they expect a fee for doing any admin.

 

[DPG]

If you have all the original paperwork from when you joined the old scheme (hopefully yes!), then careful reading should reveal anything like exit penalties. If you get a paid advisor to review it for you, I suppose it is only fair they expect a fee for doing any admin.

I've got all the paperwork. But I can get free advice so I'll see what he says. To be fair to him he's told me at least twice before, but I keep forgetting!

 

[Boat_Boy]

Look for a good Independant Financial Advisor and take advice.

Everbody's circumstance is different, and want to do different things.

There are pro's and con's no matter what you do.

If you do things right then you can have a good retirement and pass what's left on, if not the Tax man will cometh and take a big chunk.

B