28th March 2006, 12:47 PM
The contract I had with my last employer stated they could offer a stakeholder pension scheme but that it was the responsbility of the employee to notify that they wished to join. Seems fair enough but they didn't mention whether or not they will be making contributions, but somehow I doubt it.
Pensions are really only worth paying in to if you intend to keep going with the same pension scheme for a long period or if your pension is flexible and can be 'moved' around. It also depens on whether or not you can afford to make decent amounts of personal contributions. This is the same whether you pay into an employer's stakeholder pension or a personal stakeholder pension or other private pension plan.
You need to be careful about your decisions even if your employer is offering a pension plan. Staying in the Second State Pension (formely SERPS), rather than contracting out, may be a much better option for many people, particularly if you can't afford to contribute very much to any of the private schemes. Also, although you don't get tax relief on your contributions, paying into savings schemes they may offer a better return (and lower risk) in the long run and are usually more flexible for people who are in and out of work or change employers frequently.
Pensions are really only worth paying in to if you intend to keep going with the same pension scheme for a long period or if your pension is flexible and can be 'moved' around. It also depens on whether or not you can afford to make decent amounts of personal contributions. This is the same whether you pay into an employer's stakeholder pension or a personal stakeholder pension or other private pension plan.
You need to be careful about your decisions even if your employer is offering a pension plan. Staying in the Second State Pension (formely SERPS), rather than contracting out, may be a much better option for many people, particularly if you can't afford to contribute very much to any of the private schemes. Also, although you don't get tax relief on your contributions, paying into savings schemes they may offer a better return (and lower risk) in the long run and are usually more flexible for people who are in and out of work or change employers frequently.