Recommence personal pension contributions?

[Descartes Dog]

Hi, I stopped paying into my PP and ISA about 6 months ago due to financial constraints.

Now that things have improved a bit I am thinking of recommencing contributions into both but am not sure whether it would be better to take another course of action with the money as with the PP once its paid in I can't get at it should I need to. Does anyone have any thoughts on whether its worth paying into pensions in the current climate ? Cheers

[Pondlife]

If only there was another thread discussing pensions on here.

[Descartes Dog]

If only there was another thread discussing pensions on here.

Yes - that would be really useful. Oh well, wait and see if anyone has some suggestions ...

[northernladuk]

Base your future on the investment advice from the General forum of ContractorUK.. yeah that is wise lol...

[Malcolm Buggeridge]

Yes - that would be really useful. Oh well, wait and see if anyone has some suggestions ...

I started a thread on this wery subject this morning.

It'll stick be on page 1 or 2. Alternatively you could use the search facility and enter Buggeridge + my peni.ons worth naff all Thould shod bring something up Camarón th gonno

[minestrone]

My non tax investments are full ISA every year into funds & 3-4 grand into pension.

I don't expect to make a killing out of the pension, just top up my state pension to about 15 grand a year which should cover living with little tax at that time.

People keep saying that you will get taxed on the way out but if your investements are well made then you can get decent returns on the grossed up amount over the investement period.

Anyway if you choose you funds wisely then you are OK...

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[Waldorf]

I no longer fund any pensions, I invest to the max in my ISA each year, I also re-invest the income I receive from the investments, so in total my ISA is boosted by about £20K each year, and I intend to keep that up until I retire.

[Descartes Dog]

Cheers for the info guys

[LGDT]

Ignore the pension. Put it to bed and use your ISA allowance (and your partner’s too if applicable) to the max.

If you’ve any left over cash invest in unit and investment trusts outside your ISA. Remember when the time comes to use the capital from this you still have a decent CGT allowance before you need to start thinking about tax.

This gives you far more flexibility and control over your retirement income than you’ll get with a pension. Pensions are looking a mug’s game now. Low annuity rates due to QE which will probably be with us for a generation, opaque and complex tax constraints and inflexible drawdown rules mean that you give up a lot to get the tax benefits going in. I’d rather pay the tax up front and decide what to with my own money.

FWIW I do have an EPP started in 1988 which I’ve not touched since 1996. It’s up at around 110k now but the portfolio I’ve built up with my partner using PEPS/ISAs and other investments now sits comfortably in 7 figures. I’m working for fun now having just turned 50 but expect to retire at the end of the year.

People in our position need to stop genuflecting towards pensions and start thinking more in terms of “funding retirement”. Different mindset to the IFA/money advice brigade.

[escapeUK]

This gives you far more flexibility and control over your retirement income than you’ll get with a pension. Pensions are looking a mug’s game now. Low annuity rates due to QE which will probably be with us for a generation, opaque and complex tax constraints and inflexible drawdown rules mean that you give up a lot to get the tax benefits going in.

Good post. But I think you understated it, pensions are a complete and utter mugs game.