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Personal Pensions

Personal Pensions

When it comes to personal pensions, you can start with a regular monthly contribution or a single payment – either offers the opportunity to gain tax relief, which boosts your initial investment.

When it comes to investing your retirement income, time is vital. The earlier you start, the greater your capital’s ability to weather market storms and mature to a sum much grander than when it started.

Finally, what risk are you prepared to take with your savings? As we know, markets can be volatile, so you should consider a diversified portfolio that offers a spread across different sectors and asset classes in many countries.

Our summary is a 3-point approach to retirement:

1. How Much
2. How Long
3. What Returns

Set a clear target income and build this into a detailed cash flow forecast using CashCalc. You want to be certain it’s achievable and sustainable.

Pensions to Consider for Income Provision

Defined Contribution or Defined Benefit

Pensions mainly fall into either a “defined contribution” (DC) or a “defined benefit” (DB) pension scheme. Whilst many DB schemes have been closed or even folded into the Pension Protection fund, they are still found in the Civil service or some blue-chip companies. Most pensions in the UK now tend to be of a DC nature.

Types of Pension

Here’s a short list of some pensions to consider: Personal Pension, Stakeholder, Self-Invested Personal Pension, Free Standing AVC, NEST, Workplace Pensions, as well as several older styles that have existed before these.

Which to Choose?

Picking the right plan for your needs is crucial. By seeking independent financial planning, you’re ensuring the Whole of Market is considered as opposed to just one offering.

At Retirement

New Government Guidelines

With the advent of the “Pensions Freedom Act” in April 2015, the government reshaped our retirement pathways. What once might have been a straightforward decision to purchase an Annuity – a secured income for life – has been broadened with more choices.

New Options to Consider

While the Annuity remains a viable option, the landscape has expanded to include Flexible Access Drawdown (FAD), Dependents FAD, and Uncrystallised Funds Pension Lump Sum. It’s imperative to weigh these against potential income tax and inheritance tax implications. Also, with the 2015 Act in play, there are notable tax advantages associated with death benefits that need consideration.

The Lifetime Allowance

For clients whose pension pots are reaching £1 million, questions relating to the Lifetime allowance are raised. We help them to navigate these vital issues so that they steer clear of breaching this limit.

Regular Reviews

Frequent evaluations are vital to ascertain if you’re aligning with your goals, needing slight modifications, or adapting to new regulations. By staying close to our clients, we ensure targets are met and maintained.

Shape Your Financial Future

Contact us now to unlock tailored financial strategies and insights that will propel you towards financial freedom.

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