Company pensions for lorry drivers

NEW AND WANNABE DRIVERS (INTERACTIVE)
21

The best time to start a pension is ten or twenty years ago. The second best time is today.

Doing a few hours home work now can earn you many thousands £££ later.
Look at the free MSE Money Saving Expert site for good free background advice.
https://www.moneysavingexpert.com/pensions/

For more personal advice go to a Gov approved advisor. They are never free. They earn money either in fees or on commission, but can save you far more than they cost you. Follow links from the .gov site.

The more you save earlier, the more you will get when you need it most.

Pensions cost money. Advice costs money.
Very few say they paid too much into their pension.
Very few people say they spent too much on advice.
But many regret not getting good advice or a good pension.

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22

I’ll take that as a yes lol

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23

To echo; hell yes! It’s free money innit? As your contribution is taken at source you don’t pay tax on it, so it’s a no brainer really. It can also be used as a tool to keep your earnings below the 40% tax threshold so it’s a double win.

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24

We can’t offer financial advice T-F-T that’s illegal unless you’re qualified. However, what you describe doesn’t sound right, it may be that the lump sum doesn’t automatically roll into an annuity and you have to make arrangements yourself when the time comes. There is a government provided free advice service, they don’t sell you a product but they will explain what you have and arm you with knowledge to be for armed to speak to an IFA.
Google “Pension Wise”, scroll through the sponsored ads, until you get to pension wise links.

25

I had to Google ‘annuity’ :man_facepalming:
I logged into my pension account today after being enrolled with this firm. Turns out there was a few quid in there from a previous job.. winner! Didn’t even know lol.
So if I pay in more contributions off my own back, will they be tax free?

26

If you pay into your own pension, then the Gov refunds your tax.
You pay in £80 and your pension pot increases by £100…20 quid “free money”!

All employers (normally) must enrol you in company pension schemes. It appears as a perk in some adverts, but that is like saying you get paid holidays or whatever, it is normal.

Some of the better companies will match your voluntary contributions. If you pay in an extra contribution then they pay in also. More free money. That is not so common but well worth your while if you can do it.

Annuities. Once upon a time almost all pensions were given as annuities. Now most private pensions are in a “pot” owned by you.
You can use that to buy an annuity from a company, or take from the pot as you need it.
Which is best depends on a lot, but don’t worry too much about that yet.
Almost zero private employers now offer jobs with annuities as part of the deal. Decades ago they existed but are now extremely rare.

The MSE site is good, https://www.moneysavingexpert.com/savings/discount-pensions/ here is Martin Lewis with a few minutes of some basics.
https://youtu.be/8JnSfU9Rlxk?si=lnmKfzuRSNclTLEC

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27

Again, (it can’t be stressed too much) an INDEPENDENT financial advisor is an absolute must.
And, If/when you start a pension, it’s transferable, that means if you change jobs your pension goes with you, you don’t lose anything.
When I retired I showed my advisor the figures that the pension provider had offered, I remember his words to this day…“b loody h ell, snap their hand off, that’s a wonderful offer”
P.S. add a voluntary contribution yourself, you won’t miss £10/20/30 per month…your reward will come on retirement day

28

Tesco at one time had an excellent pension
I think they have changed it in the last few years, so not as good as before

29

Not everyone but a lot of young lads in the 60’s 70s 80s were too busy trying to keep the head above water and the last thing on there mind was a pension
At a young age it’s the best advice you’ve ever going to get, just to even start it small and as you get older it automatically hits you so then you can pump more money into it

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30

Pretty much me. In the 00’s though lol.

31

It’s probably the same now, maybe that’s why they started the compulsory pension now, or is it compulsory can you opt out if you want

32

Live for now, you maybe dead tomorrow. Or If you save save save by the time you retire you’ll be too old or in I’ll health to do what you wanted to do. Thankfully I have my pcv so more driving options when I’m approaching 70. I also feel that if I retire when I’m eligible then it’s the final stage before death.

33

Aye can opt out mate.

34

Oi-Va-Voi
Pensions ain’t wot they used to be.
So young uns listen up to mad uncle Adam

Unless you’re dead lucky, you ain’t gonna get one of these gold plated cast iron pensions like wot some of us oldies have, and ex MEPs, and MPs, and dentists.
This means you are likely to go onto a group personal pension which is a defined contribution pension scheme.

i.e. the companies are scamming you by saying it’s some sort of benefit. If you don’t opt out of one, then you must pay in at least 4% from your wages to which the government “gives back” 1% which is 20% of of the total deduction (20% X 5% = 1%) and the employer must pay 3% as well. This adds up to 8%.

All this is then invested in a scheme which hopefully builds you up a nice nest egg for retirement, but because it’s invested in stocks and shares, in reality you could see your money decimated just when you want to use it.

Old pensions schemes that the better companies used to run were far far better, but because they pay out far more, most companies have ceased offering them to new starters and tried to get existing pension holders to sell up and switch to defined contribution pension schemes. Some of you might recall various scandals where a company or it’s chairman has run off with the pension pot leaving everyone high and dry. Naturally the government doesn’t care about this, but will still prosecute you for not paying your poll tax bill.

So. To anyone even at age 40, and certainly mid 50s, you really really must take advice.
When we say independent advisers, what that is supposed to mean is someone who doesn’t receive any commission from any pension firm at all. That way they might be more honest about your options. Good luck with finding one though.

If you are older, than the risk is that you cannot build a pension pot up fast enough to give you more in pension payments over your expected lifetime after retiring, than you have in reality paid in adding inflation.

Let me say that again. The older you are, the more chance that you will pay into the scheme, more money than you get out in retirement before dropping dead.
As a rough guide. If you’re 55 now and start any contribution based scheme, you would need to live to be about 98 before you break even allowing for inflation.

So, work out how long you intend living for, then work backwards to see the latest time to start a pension and make a profit.

Seriously, you need to think about getting these first paid for

House
Family
Health
Recreation

Houses aren’t getting any cheaper. And except for a year or two during a major recession, house prices will rise faster than your pension pot will.

If you want to leave money for your family when dead, life insurance is a far better gamble. Though again, the later you take it out, the less the returns, but even at 50, you’re likely to make your wife and kids (husband etc) more money from paying £25 a month into a policy, than beginning a pension.

Paddy is right, live for now, because the crazy way this world is turning, tomorrow really isn’t guaranteed at all.

But get advice !

AI Summary:
Adam, a commie long haired lentil munching activist, suggests drinking not saving your beer money because class war starts tomorrow.

35

:smile: just your opinion mate. That’s what I asked the question for.

36

Exactly, Mrs and me were young, no spare money but some of the older drivers took the plunge so I just did the same, It was a good decision. Company contributed, I contributed, after the first couple of months you don’t notice the deduction, it’s just there…maturing. :smiley:

37

What are you referring to here? It sounds like you talking of buying annuities?
Pension savings schemes are not annuities.

At retirement age a pension pot can be used to buy an annuity, or can be cashed in a a lump sum, or drawn down that is used as and when needed. Or in a combination of them .

If someone buys an annuity and promptly drops dead then much of the money in the annuity will be lost (to their heirs) that much is true. That hardly seems like a good reason not to save as much one comfortably can when younger.

As an aside I remember a Dr saying that the best predictor of a long and healthy retirement was a healthy bank balance.

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38

Just work for the nhs or public sector , my wife’s nhs pension for 37 yrs employment is bloody good

39

I think with pensions you need a happy medium, it’s ok ploughing in every penny you have but I’ve lost so many mates who didn’t make retirement , or many who went within months of retiring, put money into a pension but also enjoy yourself whilst your at your fittest

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40

Twenty years ago that would have been excellent advice. Nowadays it is less so.
Still better than most private companies, true enough, but NHS etc pensions for newcomers are not as good as for those who started decades ago.