pension for 18yr old
- Thread starter dandy
- Start date
LDFerguson
Registered User
- Messages
- 4,663
I'm guessing that she may be paying no Income Tax at present either, in which case she would not be able to claim tax relief on her pension contributions, but will probably be taxed, at least in part, on her pension.
That said, if she expects to be in the tax net within a year or two, she could contribute to a PRSA and claim her tax relief at a later stage when she is paying tax. A PRSA would probably be the most suitable vehicle for small contributions as the charges are based on a small percentage of the contribution.
Jem certainly has a point, although a counter-point would be that if she starts the pension habit this early, it's likely to stay with her for life and will thank you for it when she's 40 and has accumulated a sizeable fund when others are scrabbling to start one.
That said, if she expects to be in the tax net within a year or two, she could contribute to a PRSA and claim her tax relief at a later stage when she is paying tax. A PRSA would probably be the most suitable vehicle for small contributions as the charges are based on a small percentage of the contribution.
Jem certainly has a point, although a counter-point would be that if she starts the pension habit this early, it's likely to stay with her for life and will thank you for it when she's 40 and has accumulated a sizeable fund when others are scrabbling to start one.
She could get an Eagle Star Standar PRSA through LA Brokers 0% fees, 1% annual charge. So even if she is only putting in a small amount, all of it is working for her.
At her age, she is very likely to change jobs frequently and the ability to move her PRSA when she moves is a huge benefit.
I'd quibble with the too young to start a pension that Jem made. Women tend to have more gaps in their working lives than men do and do live longer. They really do need to sock more away into a pension when they can.
That said, savings are necessary too. And the ability to juggle being sensible with having life when you are young.
At her age, she is very likely to change jobs frequently and the ability to move her PRSA when she moves is a huge benefit.
I'd quibble with the too young to start a pension that Jem made. Women tend to have more gaps in their working lives than men do and do live longer. They really do need to sock more away into a pension when they can.
That said, savings are necessary too. And the ability to juggle being sensible with having life when you are young.