# NEST pension - should I stay in?



## Mr Smin (Jul 14, 2013)

I've been auto enrolled into a NEST pension scheme. It looks pointless as the contributions from me and my employer are much smaller % than the pension scheme I was in at a previous job, so the end result is likely to be a tiny pension and the government clapping themselves on the back because everybody's old age is sorted.

Here's the link
http://www.nestpensions.org.uk
and if you are employed but not in a scheme, there's a good chance this will be offered to you soon.

I'm much more inclined to put any spare cash in an ISA. Even without employer's contribution and income tax relief, it seems a better option.


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## Maurice Picarda (Jul 14, 2013)

You'd want to put the cash in something fruitier than an ISA if it was ever going to be worth forgoing employer contribution and tax relief. Bitcoins, perhaps, or leveraged pork belly futures. Stick with the NEST if I was you.


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## Manter (Jul 14, 2013)

Employer contributions are never a bad thing, surely? And it's not accessible on a pension, and taken at source, so you can't be tempted to miss contributions because you're going through a lean patch. If you can do an ISA too, all well and good, bit I do think everyone should take advantage of pensions. Having had a better pension in the past is only relevant for your transfer value- you shouldn't take that pension and convert it to the new one. But ongoing saving in a pension is well worth doing- and you can potentially transfer this one if you end up in a better scheme later on, with no tax issues

Incidentally, the modelling of auto enrolment used to get them agreed assumed large drop outs, but most people are staying in and upping their contribution %) so it is costing companies way more than they expected, and may turn out to be a positive development for saving levels.


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## Puddy_Tat (Jul 14, 2013)

Mr Smin said:


> I'm much more inclined to put any spare cash in an ISA. Even without employer's contribution and income tax relief, it seems a better option.


 


a cash ISA might at the moment get you 2 or 3 % interest.

Is that seriously going to be better than the tax relief and employer's contribution?


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## Mr Smin (Jul 14, 2013)

No, I'm just resistant to locking money away, particularly in a scheme where the rules can be changed by the government.


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## Maurice Picarda (Jul 14, 2013)

Money is "a scheme where the rules can be changed by the government".


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## Manter (Jul 14, 2013)

Mr Smin said:


> No, I'm just resistant to locking money away, particularly in a scheme where the rules can be changed by the government.


ISAs can have the rules changed at a moment's notice! And if you pull your money out you'll lose the tax breaks, so you may as well keep it under the mattress


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## pseudonarcissus (Jul 14, 2013)

Ideally you'd do both, minimum 15% in the pension and any extra in an ISA for retirement/emergencies. 

I'm not sure U75 is the place for dispassionate retirement savings advice as a lot of people are adamant the state will have to provide for them. A nice idea but unlikely to lead to anything but marginal poverty in old age, alas.


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## fractionMan (Jul 17, 2013)

Mr Smin said:


> I've been auto enrolled into a NEST pension scheme. It looks pointless as the contributions from me and my employer are much smaller % than the pension scheme I was in at a previous job, so the end result is likely to be a tiny pension and the government clapping themselves on the back because everybody's old age is sorted.
> 
> Here's the link
> http://www.nestpensions.org.uk
> ...


 

What is your contribution % & what is the employers?

Given the tax relief on contributions and the free money from the employers I can't see how an ISA could compete for value.


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## Mr Smin (Jul 17, 2013)

fractionMan said:


> What is your contribution % & what is the employers?
> 
> Given the tax relief on contributions and the free money from the employers I can't see how an ISA could compete for value.


 

Min contributions are presently 0.8% from me, 1% from employer, by 2018 this will be min 4% from me and 3% from employer. I could put more in and I can't tell from the booklet if this obliges the employer to proportionately 'match up'. There are some small charges on this.
I don't expect the ISA to grow faster, I just like the fact that I still control the money and can move it if I want to.
The NEST seems like another one-way bet for the supplier while leaving me with risk and no control.


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## Manter (Jul 17, 2013)

Mr Smin said:


> Min contributions are presently 0.8% from me, 1% from employer, by 2018 this will be min 4% from me and 3% from employer. I could put more in and I can't tell from the booklet if this obliges the employer to proportionately 'match up'. There are some small charges on this.
> I don't expect the ISA to grow faster, I just like the fact that I still control the money and can move it if I want to.
> The NEST seems like another one-way bet for the supplier while leaving me with risk and no control.


Putting aside paranoia for a moment, think about why auto enrollment has been introduced.  We have a pension funding crisis, and the idea is to take advantage of people's inertia to get them saving, rather than trying to overcome inertia to try and get them to sign up.  The government wants people to have some money to live on in their old age, so less of the burden falls on the state.  Pensions are *supposed* to leave you with no control of the money- you're not supposed to be able to get hold of it and spend it on things you think you urgently need at the time (university fees, school shoes, new car)- its locked away from you until you're retired.   The employer contributions and tax incentives are essentially incentives for you to allow that money to be locked away- and the return on your investment is usually better too over the course of your working life as pension funds can look at long term investments.   

If you truly believe its all a conspiracy, stick some money you can afford to lose in an ISA and shove the rest under a mattress:  but missing out on 5.2% of your income in pretty secure savings preparing for your future is, frankly, crackers


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## fractionMan (Jul 17, 2013)

You need to find out how the matching increases with you own contributions.  Even if its only 5% that's 5% free money.


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## Badgers (Sep 17, 2013)

Have set mine up today. Pretty good website I thought. 

I have virtually nothing going in at the moment but no harm in having it as employer is paying in too.


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## ChrisEdwards (Mar 31, 2017)

I don't think putting cash in an ISA is the best option there is other option too for this and you can get a solution for it also.


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## bi0boy (Mar 31, 2017)

ChrisEdwards said:


> I don't think putting cash in an ISA is the best option there is other option too for this and you can get a solution for it also.



In HRL perhaps?


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## ska invita (Mar 31, 2017)

BTW go into your profile and you can switch from NEST to NEST Ethical, which at least doesnt invest in the arms trade. Not the most ethical pension scheme out there - I'm guessing a big amount of money raised by NEST and NEST Ethical is made from flipping houses and pumping up the housing bubble - but at least its a bit more ethical than standard NEST.

That said, the whole business of these new forced pensions makes me cringe...its a roll out of stakeholder society...I would never choose to take part in the stock market, nor in property investment, so Im annoyed at doing so here. Im currently trying to encourage my employer to move to AEGON, which seemed to be the most ethical I could find Ethical buying guide to Pensions, from Ethical Consumer
yet its still utter shit, with holdings in Mosanto, Apple and Walmart
The whole thing makes my blood boil...not sure wether to just opt out of all of it


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## ska invita (Mar 31, 2017)

You're handing money to arms companies - and you don't even know about it <<<NEST


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## alex_ (Mar 31, 2017)

Mr Smin said:


> Min contributions are presently 0.8% from me, 1% from employer, by 2018 this will be min 4% from me and 3% from employer. I could put more in and I can't tell from the booklet if this obliges the employer to proportionately 'match up'. There are some small charges on this.
> I don't expect the ISA to grow faster, I just like the fact that I still control the money and can move it if I want to.
> The NEST seems like another one-way bet for the supplier while leaving me with risk and no control.



It comes out of your salary before tax so it costs you 20 to 65 % less than if you were putting into an isa, it's almost certain to have a better rate of return than an isa in the very long term and you contribs will go up in line with your salary - it's win win win.


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## ska invita (Mar 31, 2017)

alex_ said:


> it's win win win.


for estate agents, arms dealers and big corporations


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## alex_ (Mar 31, 2017)

ska invita said:


> for estate agents, arms dealers and big corporations



If they win you win.


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## bi0boy (Mar 31, 2017)

ska invita said:


> for estate agents, arms dealers and big corporations



Where do you think some of the taxes come from that will pay your state pension? It's really no different to that. Forgoing your employer contribution because capitalism is something you should think about very carefully.


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## ska invita (Mar 31, 2017)

bi0boy said:


> Where do you think some of the taxes come from that will pay your state pension? It's really no different to that. Forgoing your employer contribution because capitalism is something you should think about very carefully.


I know that... It's still shit


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## ska invita (Mar 31, 2017)

alex_ said:


> If they win you win.


we all lose


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## Mr Smin (Apr 1, 2017)

alex_ said:


> It comes out of your salary before tax so it costs you 20 to 65 % less than if you were putting into an isa, it's almost certain to have a better rate of return than an isa in the very long term and you contribs will go up in line with your salary - it's win win win.


One hell of a bump from 2003! Today a smack in the mouth has a better rate of return than most ISAs. I have since changed employers and I'm now in a pension scheme that's got a meaningful percentage coming from me and from the employer.


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## bi0boy (Apr 1, 2017)

Anyone can save for their own pension instead of or in addition to a workplace pension. Obviously doing your own one would mean no employer contributions but you can still get the tax benefits by using a SIPP (you get a 20% or 40% added to everything you put in) or ISAs (tax free income when you take it out) or a combination of the two.


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## moochedit (Apr 2, 2017)

fractionMan said:


> You need to find out how the matching increases with you own contributions.  Even if its only 5% that's 5% free money.



My employer is starting an auto enrolment pension scheme in july this year(for some reason in the rules they have been able to put it off until then).
We were told that we could pay in more than the minimum employee %age (if we want to), but that they would still only contribute the same amount (i.e. the minimum %age of our wages they have to pay into it). 
I think we would still get extra tax relief from the goverment though if we increase it.
We are not with "NEST" though, think they are called "Peoples Pension" IIRC.

You can opt-out but I think i will stay in it, although i may change my mind.


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## moochedit (Apr 2, 2017)

bi0boy said:


> Anyone can save for their own pension instead of or in addition to a workplace pension.



Yeah, I have one with prudential that i started years ago, but i kept stopping and restarting the payments when i'm skint, so i don't think it will be worth much in the end.
No employer payments into it either.
Actually, I must find out if i can transfer it into the work one as i think you can do that.


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## fractionMan (Apr 2, 2017)

moochedit said:


> My employer is starting an auto enrolment pension scheme in july this year(for some reason in the rules they have been able to put it off until then).
> We were told that we could pay in more than the minimum employee %age (if we want to), but that they would still only contribute the same amount (i.e. the minimum %age of our wages they have to pay into it).
> I think we would still get extra tax relief from the goverment though if we increase it.
> We are not with "NEST" though, think they are called "Peoples Pension" IIRC.
> ...



Yeah it really depends.  My current employer has managed to put it off too and isn't going to match contributions past 5% and I had to fight for the 5%, they were offering 2%


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## moochedit (Apr 2, 2017)

fractionMan said:


> Yeah it really depends.  My current employer has managed to put it off too and isn't going to match contributions past 5% and I had to fight for the 5%, they were offering 2%



yeah, mine won't pay in any more than they legally have to. They went bust about 3 years ago because of an old final salary pension scheme they couldn't afford and then they restarted up as a "pheonix company" to get out of the debts.  (dodgy i know but it is legal to do that apparently). I was one of the lucky ones that got my job back after a few weeks. I was never a member of the old pension scheme as it closed to new staff before i joined them.


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## alex_ (Apr 2, 2017)

moochedit said:


> I think we would still get extra tax relief from the goverment though if we increase it.



Yes you get tax relief at your highest marginal rate on upto 40k of contributions per year.

This is why pensions saving is so recommended, because you have to pay tax on anything you put in your isa, not so your pension.

Alex


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## Roxanna123 (May 5, 2018)

My clients and I have been with Nest for a couple of years. It's just a pension provider recommended by government, and they are compliant with the regulations. At the moment. 
But since they moved their Helpdesk to overseas, any work with them becomes impossibly difficult! They close the chat in the middle of conversation, don't understand the simpliest requests, and it's impossible to amend the size of contribution. I'm an accountant, and I get info from the clients at the end of the month, before the payday, if they have anybody new on board and about contributions. Nest doesn't allow to enter data back dated (f.e. on 29/04 to enter info related to 01/04), and helpdesk is very rude and absolutely useless. They just don't understand the question (or pretend they don't - it depends how do they paid).
I personally had a case when, being subscribed to them by my former employer for 6-7 months and having a confirmation letter from Richard Hardy ( Nest mythical character), got a written answer to my request stated they don't have me in the list, and the letter was signed by the same Richard Hardy.
Due to my profession I have exposed to Scottish Widows. They have live person on the phone who has enough brain to understand what help the client need and to give a proper advice. 
It's happened I've lost almost 1 working day this week in total trying to resolve a small issue with Nest - I was trying to amend a size of contribution back dated, from 01/04.
I've just resolved it - by myself, but I lost about 40 min today (again!) with smbdy Ahmed from Nest. Useless. 
I think on Tuesday, after bank holidays, I will discuss with Scottish Widows how I can transfer the pension pots to them, and instruct my client accordingly.


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## A380 (May 8, 2018)

Helpful advice, or Scottish Widow robot?


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## mauvais (May 8, 2018)

I've got a Scottish Widows pension*. The website is amazing. It looks like it's from about 1994.

*I do this on purpose now


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