Choice of pension fund

[Mikexx]

Making choices like this fill me with dread.

Can anyone provide recommendations?

I am working through an umbrella and shall be taking a large hit on my income in the form of a salary sacrifice into a pension fund and would be grateful for any steer or suggestions?

[WTFH]

Could I suggest that you speak to your financial advisor. You can go through the exact details with them. On here we can talk about who each of us have pensions with, but it's all down to personal circumstances - are you single, do you have a partner, do you have children, what outgoings do you have, how long until you plan to retire, how risk averse are you, how much can you afford to put in each month, etc, etc.

[Mikexx]

Could I suggest that you speak to your financial advisor. You can go through the exact details with them. On here we can talk about who each of us have pensions with, but it's all down to personal circumstances - are you single, do you have a partner, do you have children, what outgoings do you have, how long until you plan to retire, how risk averse are you, how much can you afford to put in each month, etc, etc.

I don't have a financial adviser hence the question. I can see where you're coming from. I only have a few years to retire and while I have children this is more about shovelling as much money into a pot free of tax while I can. A pension fund can be transferred and so I am looking for one with minimal transfer fees.

[gables]

On similar topics regarding this I have noticed in the past that Hargreaves Lansdown and Interactive Investor get mentioned, maybe chat with them.

But I am not an IFA and this is not financial advice.

[Protagoras]

An umbrella company may not be able to send payments to all pension providers and may make a charge for this. So I'd suggest starting with what's available from the umbrella company since this may limit choice.

The choice of funds is a challenge for most people. If this is just a short-term thing for the umbrella engagement you could always pop the funds in an easy-to-setup online pension scheme and then transfer later.

Many schemes will apply some sort of risk-adjustment between funds based on time to retirement. Again, this depends on one's risk appetite.

[Ketto]

I don't have a financial adviser hence the question. I can see where you're coming from. I only have a few years to retire and while I have children this is more about shovelling as much money into a pot free of tax while I can. A pension fund can be transferred and so I am looking for one with minimal transfer fees.

I’d recommend getting an IFA. They don’t charge the earth to advise regards a pension and then set one up. Even a few years of contributions could be a lot of money, best to be as informed as you can be.

[woody1]

If you're only a few years from retirement, and are just looking for somewhere to stash the money rather than grow it, then a cash or money market fund might be the answer. These are very low volatility (low risk). With some SIPPs you could probably even keep some of the money as actual cash, although the interest rates tend to be quite poor.

All pension providers offer these funds and, as someone else said, might be worth asking the umbrella company if they have preferred providers.

[Smartie]

As per all the other comments, you should probably take advice based on your own circumstances.

But, if you want a platform recommendation, II are decent and the fees are low, particularly when your pot is large.

For a basic fund you could look at Vanguard Lifestrategy funds, including the 80/20 shares/bonds one.
Otherwise, ETF world index tracker funds are low fee and spread risk to an extent, though 70% ends up in the USA currently.

While some pension funds 'lifestyle' you into more and more bonds as you close in on retirement, a lot of the current advice is that you need to keep more in shares despite the volatility.
You might spend 40 years in retirement so dumping it all in cash when you retire is a bad idea, unless of course you plan on taking it fairly quickly, really can't afford to risk losses or have a huge amount saved already.

Given you're getting 40%+ extra saved from the salary sacrifice, you can afford quite high losses and still come out ahead.

[eek]

The advice I got years back was Hargreaves Lansdown as you built up the fund and a transfer to II at the points the II fees became cheaper..

[ladymuck]

If you're only a few years from retirement, and are just looking for somewhere to stash the money rather than grow it, then a cash or money market fund might be the answer. These are very low volatility (low risk). With some SIPPs you could probably even keep some of the money as actual cash, although the interest rates tend to be quite poor.

All pension providers offer these funds and, as someone else said, might be worth asking the umbrella company if they have preferred providers.

The downside with that is if the dumping of all bar minimum wage into a SIPP (or other pension vehicle) is to maximise saving while cutting back on NI payments, those options won't work with that strategy.