am pretty shit when it comes to this sort of stuff and not really sure wtf its all about but both me and my missus are opted out but just wondering if opting back in is a good option and are there any consequencies if we do or dont? so if anyone in the job of this sort of stuff is on ere then i could do with some info...thanks
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pensions..serps,in or out
- Thread starter stonie
- Start date
Contracting out is a rebate of some of your own and your employer's National Insurance contributions into your own personal or stakeholder pension. This is a redirection of monies that would have been allocated for the State Second Pension, previously known as SERPS. The State Second Pension is a top-up pension to your Basic State Pension, based on the average salary you earn during your working life.
Some people might be better off by having these contributions paid into their own personal or stakeholder pensions instead. This is known as 'contracting out'.
As your both currently contracting out, you both need to decide whether your National Insurance rebates paid into your pensions will provide you with a better pension than the additional state pension would. The consequences are that your personal pensions may not provide you with a better pension (if your fund falls in value due to poor long term investment performance). You need to know where your funds are invested and review these every 12 to 18 months. Also, as I don't know how old you both are you need to consider how long you have until you retire as some individuals are advised contract in as they near retirement.
If you do decide to contract out of the State Second Pension, you will still be entitled to any SERPS or State Second Pension that you built up before you contracted out.
If in doubt I would advise you to contact an independent financial adviser.
Some people might be better off by having these contributions paid into their own personal or stakeholder pensions instead. This is known as 'contracting out'.
As your both currently contracting out, you both need to decide whether your National Insurance rebates paid into your pensions will provide you with a better pension than the additional state pension would. The consequences are that your personal pensions may not provide you with a better pension (if your fund falls in value due to poor long term investment performance). You need to know where your funds are invested and review these every 12 to 18 months. Also, as I don't know how old you both are you need to consider how long you have until you retire as some individuals are advised contract in as they near retirement.
If you do decide to contract out of the State Second Pension, you will still be entitled to any SERPS or State Second Pension that you built up before you contracted out.
If in doubt I would advise you to contact an independent financial adviser.
denislawsbackheel
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Remember that the only truly independent financial adviser is one you pay an hourly rate to and isn't getting commission from the stuff they sell you.