Typical employer pension contributions

[Snooky]

Yes, I know this is a contracting forum and yes, I'm a contractor - at the moment. But bear with me.

I'm being tempted with a fairly healthy permie package and I'm giving it genuine consideration. Nearly everything about it is attractive - salary, benefits, the company, the team, the type of work, complete lack of stupid politics. I'm not getting any younger and the overwhelming benefits of contracting aren't what they used to be; I can do without all the hassle of trying to cover myself at all times.

The only problem is the pension. They're offering an employer contribution which is only just above the 3% legal minimum. I think this may be because they're a small company without much familiarity with the recruitment/retention side of things. They want to grow and recruit really good people, I've explained that they might struggle to lure folks away from investment banks, other FinTech companies, etc. with that kind of pension.

But, having been contracting for decades, I may be completely out of touch with what companies offer these days.

I believe we have people here who've gone permie - albeit temporarily - or at least looked at potential permie packages. So what employer contribution, and what level of matching of employee contribution, have you seen or experienced? I'd be interested to know whether it was also in the FinTech / financial arena.

[SueEllen]

Does the company match if you pay in more? A few companies do that up to 5-7%.

[WTFH]

I was offered a perm role in pharma/med with a 10% employer contribution, but that was with one of the largest companies in the industry.

[d000hg]

Does the company match if you pay in more? A few companies do that up to 5-7%.

If they won't, is there any real difference getting the salary up and paying more in yourself (I forget how the tax relief works?)
Ultimately it's the overall package value that matters, I'd say. If they don't do good pensions, you need the salary to make up for it (or maybe other perks).

If you're nearer the end of your career than the start, is a pension contribution really that important anyway?

[eek]

If they won't, is there any real difference getting the salary up and paying more in yourself (I forget how the tax relief works?)
Ultimately it's the overall package value that matters, I'd say. If they don't do good pensions, you need the salary to make up for it (or maybe other perks).

If you're nearer the end of your career than the start, is a pension contribution really that important anyway?

Most important thing you really want is for the company to allow you to pay in via salary sacrifice and contribute the Employer NI that that saves them....

[Smartie]

If they won't, is there any real difference getting the salary up and paying more in yourself (I forget how the tax relief works?)
Ultimately it's the overall package value that matters, I'd say. If they don't do good pensions, you need the salary to make up for it (or maybe other perks).

If you're nearer the end of your career than the start, is a pension contribution really that important anyway?

I suspect for a lot of people nearer the end of their career than the start i.e. age 40-50+ then a pension contribution might be the most important thing.

People have various costs when they're younger - schools, mortgages etc. and while later contributions don't have the same impact as earlier contributions due to compounding, it is often the time when they can put a lot more into a pension.

Given the tax efficiency i.e. 25% tax free and basic rate tax on withdrawals (most likely) compared to higher rate tax, it's a winner for savings if you can, especially when you're closer to retirement age (55, 57 soon).

[mattster]

Ultimately it's the overall package value that matters, I'd say. If they don't do good pensions, you need the salary to make up for it (or maybe other perks).

3% is pretty low as pension contrinutions go (last permie position I had it was 15%), but at the end of the day the above is correct: the total package is all that matters. Arguably it could even be better to have a higher salary vs lower salary + higher pension e.g. if it ever came to redunancy or any other benefit based on your salary (bonus?), and you can decide exactly how much you want to stick in the pension. Definitely try to make sure they give you back the employer's NI tho if you do up it.