Enrolling into my first pension

A question about : Enrolling into my first pension

Hi,

i will be shortly enrolling into my first pension and had a meeting with my advisor last week.

My company will be paying in 5% and i plan to do the same initially.

now obviously what the pension people will do is invest my money into the market. This is what really interested me as i already have investments.

What i wanted to ask you guys is do i need to tie in my investments into what the pension company are doing with my money ? And how involved do i need to be in my pension ?

My advisor says not many do as they dont understand investing but personally i would like to get involved as its my interest.

Do any of you guys get heavily involved with your pension and also is there any general advise you have with enrolling in pensions?

i would also like to go into contribution amount aswell im 23 and have a long time horizon so im hoping i can build up a decent pot come retirement.

Look forward to your thoughts.

Best answers:

• Whilst you will have limited control over what the DC pot is invested in you can certainly take that into account when considering what / where else you invest in.
  You have investments already you say, so if you were to look at "Your total investments" (DC + Personal) I would suggest that the overall mix should fit with your preferred Asset Allocation strategy rather than both pots duplicating or overlapping each other.
  A simple example - If you DC pot funds were invested in large cap stocks at 40% US, 30% UK, 15% Europe and 15% Japan then outside the DC pot you could invest in Asia ex-Japan, Emerging Markets, Smaller Companies to increase your diversification.
  Time scales and the potential "reason for the pot" need to be considered as well. The DC pot is for your late 50s at the earliest, you may want to access the non-DC investments before that - for house purchase, marriage, kids etc.
  What cash savings do you have as an emergency fund (sudden need for a replacement car, redundancy and the like can strike at any time)?
  Having everything "invested" in the markets could leave you exposed to selling at a low point and losing money, having available cash can get over that.
  BTW - Congratulate yourself, the majority of 23 year olds are not that interested in pensions and investments, but don't miss out on enjoying yourself while you are young, free and single (assuming no significant other at the moment).