Pensions
#1
OK, need help.
I've been offered a new job and the pension pays in 1% less that my current company pays in. Not a great amount I know but I'm 24, I've been in my crrent pension scheme (with my current employer paying 6%) for 18 months. SO I know my contributions would be refunded to me less tax.
My worry is that I'm basically starting from scratch again but my total contributions would be 1% less each year.
Would the past 18 months payments be worth a lot come retirement. I'm aware the earlier you start a pension the better. So would losing this 18 months worth make a big differeffence also would paying 1% less be a big difference.
Please help......
I've been offered a new job and the pension pays in 1% less that my current company pays in. Not a great amount I know but I'm 24, I've been in my crrent pension scheme (with my current employer paying 6%) for 18 months. SO I know my contributions would be refunded to me less tax.
My worry is that I'm basically starting from scratch again but my total contributions would be 1% less each year.
Would the past 18 months payments be worth a lot come retirement. I'm aware the earlier you start a pension the better. So would losing this 18 months worth make a big differeffence also would paying 1% less be a big difference.
Please help......
#2
Matt
There are various different types of scheme, and different qualities of provider. Without more information, it is not possible to give a definitive answer.
<UL TYPE=SQUARE>
<LI>are the schemes money purchase (defined contributions) or final salary (defined benefits)?
<LI>how are the funds invested, and by who?
<LI>are they contracted into or out of SERPS?
<LI>when do you intend to retire, and are you intending providing a pension for your partner?
</UL>
Sorry to be a pain, but the information is necessary to provide a sensible answer. Mail me off line if you don't want to publish this information.
Regards
Duncan
There are various different types of scheme, and different qualities of provider. Without more information, it is not possible to give a definitive answer.
<UL TYPE=SQUARE>
<LI>are the schemes money purchase (defined contributions) or final salary (defined benefits)?
<LI>how are the funds invested, and by who?
<LI>are they contracted into or out of SERPS?
<LI>when do you intend to retire, and are you intending providing a pension for your partner?
</UL>
Sorry to be a pain, but the information is necessary to provide a sensible answer. Mail me off line if you don't want to publish this information.
Regards
Duncan
#3
Matt - bug eyed is right. Each piece of detail is needed to give correct advice. As a rule of thumb, for every year that passes you would need to increase your contribution by 20% to get the same fund at retirement. You where contributing 6% for 18 months so you would need to contribute around 7.8% to have the same fund come retirement. Do you have an option for AVC's or can you make a regular contribution?
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