Do I need a retirement pension

[gailey]

I am the first to admit that I don't have a clue when it comes to pensions but do I need to pay into a pension scheme if I am working part time and only earning 25,000 a year? By the time I retire my mortgage will be paid and surely I will be entitled to a contributory pension. My husband is paying into a pension scheme with Canada Life. He is paying 25 euro from his wages and his employer is also paying towards it. The expected projections for this is with 6% growth 66,109 or 8% growth 93,500. Is this enough cover for us or should we increase it or should I get a seperate policy? We are both 30 and my husband is earning 30,000 a year. I have tried to research this myself but I am getting more confused. I would appreciate any wise opinions.

 

[pat127]

I am the first to admit that I don't have a clue when it comes to pensions but do I need to pay into a pension scheme if I am working part time and only earning 25,000 a year? By the time I retire my mortgage will be paid and surely I will be entitled to a contributory pension.

Don't gamble on being entitled to a contributory pension. It has to be earned by paying contributions virtually throughout your working life. The rules are worth studying at:-


[broken link removed]

All being well, you should have your mortgage paid off but you don't yet know what unexpected financial demands may come along later in life. A chat with an independent pesnions adviser wouldn't be a bad idea in my opinion.

 

[RainyDay]

There is no simple answer to this question. Have you checked out the levels of the current state pension? Could you survive on this level of income today? Have you taken into account the liklihood of increased health costs and/or long term care as you get older?

The benefits of paying into a pension are;
1) You can often get employers to match your contributions. This really is 'money for nothing' and you should avail of any such offers.
2) Tax deferral - pension contributions are taken from your gross salary (before tax is deducted). If you pay tax at 42%, this means that it costs you €58 in after-tax income to make a €100 contribution to your pension.

As a general rule, if you can make additional pension payments without seriously impacting your lifestyle, it is a good idea to do so.

 

[woods]

My husband is paying into a pension scheme with Canada Life. He is paying 25 euro from his wages and his employer is also paying towards it. The expected projections for this is with 6% growth 66,109 or 8% growth 93,500. Is this enough cover for us or should we increase it or should I get a seperate policy? .

I think that this will not generate much more than pocket money for you when the time comes.
It may be cheaper to increase his than to take one out for you and if his employer ups the contributions as well then that will be an added bonus.