Pension Contributions Question

dtlyn

Registered User
Messages
166
Age: 25
Spouse’s/Partner's age: 25

Annual gross income from employment or profession: 43000 + 4300 bonus.

Annual gross income of spouse: 0 ( Student )

Type of employment: Private ( IT )
Student, soon to be Public ( Profession )

In general are you spending more than you earn or are you saving?

Recently cleared college debt, now saving ~ 700/month.

- [ No Home]

Other borrowings – Car Loan - 2700 remaining

Do you pay off your full credit card balance each month? Yes

Savings and investments:

2000 Rabobank
101 Vodafone Shares. ( Don't ask )

Do you have a pension scheme? Yes

Currently employer matching 5% contributions.

Do you own any investment or other property? Nope

Ages of children: None

Life insurance: None


What specific question do you have or what issues are of concern to you?

Before I start my reasoning behind having 2k savings and 3k car loan is as follows. After suffering sports injury decided that benefits of having emergency fund ( covering medical expenses unsettled or not covered by BUPA ) as well as support for unknown given current employment trends ( including IT sector ) outweighs paying off small low interest ( 8.1% ) car loan. Overpaying loan and will have it gone by Christmas.

My question relates to my pension.

Currently I pay 179.17 pension contributions monthly. This is matched by my employer.

I was considering stopping paying this and assume my monthly salary will rise by ~ 108 having done so. I was planning on using the extra to partially fund helping my OH through her final year in college.

Elsewhere in the site opinions vary as to when a pension should start ( e.g. buy a house first ) but I consider the employer contributions to be a decent perk here. Given the current market volatility in pension funds and opinions elsewhere on the site, would it be a bad financial decision to stop paying pension contributions for 1 year to avail of the extra monthly income?

We will be 26 when OH graduates and intend to re-establish payments then ( with expected higher salary ). Or would a better suggestion be to invest the income over 5 years working towards house deposit?

Any opinions grateful.

Thanks,

D
 
Elsewhere in the site opinions vary as to when a pension should start ( e.g. buy a house first ) but I consider the employer contributions to be a decent perk here. Given the current market volatility in pension funds and opinions elsewhere on the site, would it be a bad financial decision to stop paying pension contributions for 1 year to avail of the extra monthly income?
If employer contributions are on offer then it normally makes sense to contribute to the extent necessary to avail of these. Apart from that it may make more sense to prioritise reducing/clearing debts and savings towards a house (if that's the plan) over pension contributions.
 
If employer contributions are on offer then it normally makes sense to contribute to the extent necessary to avail of these. Apart from that it may make more sense to prioritise reducing/clearing debts and savings towards a house (if that's the plan) over pension contributions.

So if I understand what you're saying keep the contributions as they are at a bare minimum.

Thanks Clubman.
 
On the basis of what you have posted so far that is what I would consider doing.
 
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