Personal Pension Plan or Stakeholder?

Question

Thanks to those who replied. A further quesion; what happens if you have to stop work for whatever reason - i.e. do you lose money or is the pension frozen enabling you to continue contributing when possible? Thanks for replying.

Answer 1

A Personal Pension (SIPP) is exactly that = it's personal i.e. it belongs to you and you administer it (usually on-line) just like an ISA. If the Company was making contributions, plainly these stop when you leave the company, however you can carry on making your own contributions.

A Stakeholder is usually setup via the Company you work for. They usually pay the administration charges, and usually the Company 'matches' your contributions.So, when you leave, the Company usually 'freezes' your Stakeholder (no more contributions allowed).
Most Companies will carry on paying the administration charges, so you might be better off leaving it, however if you start at a new Company who also offers Stakeholder, it's usually best to Transfer (so everything is in the same place where you can keep an eye on it == it's very easy after 30 years to end up with 5 or 6 separate Pensions .. and then discover your pension has been halved due to paying 5 or 6 separate charges !)

They will explain all the options when you leave, however you will always be able to Transfer the funds into your own Personal Pension.

Answer 2

Yes, all pensions can be frozen at any time but if you put it on hold for a long time you will be charged a small £££ fee

Answer 3

Another alternative is to keep the pension open by making small contributions. You will still get tax relief even if you don't have any taxable income

Answer 4

Your pension is frozen until you are in position to continue to pay into it.

Answer 5

neither, its better to have a mutual or trust funds