Fair enough master sommelier may seem silly comparison but it’s the pinnacle of the career of being a specialised waiter no? There are top maitre-d’s who earn that much too

As Dave says there are many ways of making that job as skilled and hard working and multi pronged as you want

An average server in an average resto is not earning anywhere near £50k I think that’s safe to say

Yeah back on topic. Pension armageddon - we're all doomed. Latest bad realisation: our country will not be able to afford triple-locked state pensions in their current state. Don't expect your state pension (when you can finally collect it - I'd guess for many of us it won't be until we're 70, just think the French are rioting over 62-64!) to cover anything other than the basics, if even that

I might start voting Tory

It'd still only be up by 5% no matter how much you were putting in.

Whatever you can is worthwhile.

RamSteelwood wrote:

well in sort of related news, i got my actual work pension statement the other day and that's doing shit and in the last year appears to have gone up significantly less than the contributions (primarily due to their 'management charges' which they're obviously not doing particularly well to earn!)

Well this is the problem and why doing it yourself with a tracker is the cheapest and easiest option.

Having both is the best solution imo.
Workplace Pensions are inherently safe, you are a lot less likely to lose in a big crash but they don't gain as much.
The big benefit is the employer contributions, which give you gains/free money regardless of market turbulence.

Max out the employer contributions then move onto a SIPP is my strategy.
Later in life it can be worth cashing out part of the Workplace Pension to put into the SIPP or other investments depending on markets.

Yeah.
With it being a pension you get the tax breaks that you get on a workplace pension too. Not sure how that compares to the ISAs most have here.

Also doesn’t apply to those not earning enough to pay tax

My SIPP is with Hargreaves Lansdown if that helps at all.
I have no idea how they stack up but seems fine to me, very easy to use.

Think it is auto yeah, needed some setting up though iirc. (It's been a while)

I'm not a higher rate no. I set mine up as I was self employed so had no workplace pension and needed to put something somewhere.

If you are higher rate is absolutely worth doing though as Funk says.
Especially if you are still working when the mortgage is paid off towards the end of your career. Slam the SIPP with what was the mortgage money for a few years and you will be laughing.

I’d say you need to think of them differently. An ISA is a post tax, post salary-into-your-account savings account. You just don’t pay more tax on the return on the savings. So if you buy into a tracker fund, and it goes up by lots of % and that adds up to £thousand+, you won’t pay tax on it.

You would pay tax on the increase / interest if the savings were not in an isa but a “normal” savings account or investment trading account.

For pensions, it’s supposed to be a pre tax, pre salary into account thing (you may have heard the term salary sacrifice, that is what that means). Your workplace pension automatically puts the whole lot (the monthly contribution amount and the tax you’d’ve paid on that if given as salary) into the workplace pension account. But when you pay into your own pension from your post tax salary money, you get the tax you paid on it back from the gov.

For lower rate tax payers that’s automatic, it should pop into the SIPP within weeks usually. For higher rate you have to get the rebate difference by asking for it. This is most easily done via a self assessment tax return, but you can contact HMRC directly to sort it.

What this means for the 25% / amounts to be found in your various accounts at 55 (remember it will be 57 by 2028…):

Well in your example, your £50 a month for 11 years comes to £6600 indeed. But then let’s say you’re a normal rate tax payer. So that amount actually will be £8250 before any return on investment (£11000 if you’re a 40% payer)

Whereas your ISA is still £6600 before return on investment. Let’s say you achieve a return of 5% per year. That will mean your isa will be worth £8812. Your pension will be £11015, or (of course) exactly 25% more. And an amazing £14686, or 67% more, if higher rate

Yes, you can then at 57 take 25% tax free lump sum from SIPP whereas the isa you can take the lot. But I’d rather have the extra money please

Cheers

Is it worth investing in GOOOOOOOLD? (Goldmember.gif)

Not that is pertains much to pension investments but your comments about China are interesting given how they control, what, 75%+ of the world’s resources and early supply chains needed for green energy?

If anyone is serious about transitioning from fossil fuels (haha yes I know lol) China have serious leverage. Maybe they have an actual plan to deal with manufacturing moving on (which certainly seems the case: exports down double digits YoY is an astonishing figure post Covid)