The fifth element

By THIS IS MONEY
Updated:

 

CAN I invest in a stakeholder pension? I have three sources of income: A teaching post paying £34,000, literary royalties of £8,000-£10,000 a year and rental income of £4,000. I am in the teachers' pension and I have in the past purchased past added years. SF, Dover.

Jon Minchin, financial adviser with Pensionline says: As you are a member of an occupational pension scheme and earning over £30,000 you cannot contribute to a stakeholder pension from your teaching income source.

But that does not mean a stakeholder is ruled out altogether. Your royalties are classed as self-employed income, so you can contribute £3,600 gross to a stakeholder plan every year.

Rental income does not count as 'net relevant earnings' and is therefore not relevant when it comes to working out your possible pension contributions.

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