Salary sacrifice Tesco shares Vs pension

@soundninjauk – that Mr Money Moustache looks like a great site. I’m already getting slight obsessional about my expenditure, so loads of things to try there.

Why are those the only choices?

At that age (especially if not yet on the housing ladder) I wouldn’t do a company share scheme if all it saved was tax/NI (I use my company’s share scheme but only because they match 1 for 1 up to 3% of salary, I used to actually sacrifice/buy 10% as was a handy way of saving without having it locked up in a pension and year or year they go up at least 8% – you do need to factor in capital gains and they’ve just cut the allowance though). If the share scheme didn’t match any then unless I was really confident they’d perform better than an investment fund I wouldn’t bother.

Investing early into a pension is always a good idea but the flipside is you’re tying up your money and for a lot of young people they have a more important need for it in the short term.

So personally I’d continue with the minimum contributions to the pension and increase savings via an investment fund, until I was on the housing ladder, had done any renovations it needed, had a car etc. and only then start paying a larger amount into my pension (which for me was in my late 20’s)

If you take money out post tax then you have a fair bit of catching up to do – the tax savings alone provide an annual return of 6.8% over a five year period.

that Mr Money Moustache looks like a great site. I’m already getting slight obsessional about my expenditure, so loads of things to try there.

@Kramer Yeah he’s got some strong opinions on people should be spending their money on (and what not to spend money on probably more to the point). I’m not going to say that I fully subscribe to his approach, but his post on hedonistic adaptation definitely had an effect on me.

@soundninjauk I started a few years ago, basically by starting to replace some meat in my diet with plant based options without feeling I’d lost out. After that I branched into my finances, doing the same thing, was it possible to save money without feeling that I’d lost quality of life. I’m lucky that I have a decent income anyway, but it is interesting to start to look at it and realise where my money goes that doesn’t add to my enjoyment of life. Takeaways being a prime example.