Pensions planning today can cover a lifetime: Funding can begin at any age from nought onwards (as contributions can be paid on behalf of others, including children) and benefits no longer need to be exchanged for annuities at a prescriptive age, so choices can be retained throughout retirement.
It is never too late to improve your pension funding, but, it makes sense to start as soon as possible, as contributions paid in early provide the best prospects for growth. This means that you may be able to pay in less or retire earlier than someone who starts later.
A personal approach
We do not operate a one-size-fits-all approach. Your Charles Derby Financial Planning Consultant will help you plan your pension with you and your own aims in mind. We recognise that everyone’s situation is different and take this into account in helping you to get underway. As an overview, there are just three steps to get up and running:
We will get to know you and your financial situation.
We will report, discuss and guide you on your options.
We will take care of the paperwork and process to get your pension started.
In the first step, we will assess your options, including all suitable approved pensions, such as Personal Pensions, Self Invested Personal Pensions and any employer schemes that may be available to you. All the options will be explained in person, so you will understand what they all offer.
Choosing a suitable product and product provider is followed by selecting the investments. Again, we will explain all the options and provide recommendations suitable to your own circumstances, aims and attitude to risk. Your attitude to risk is an important factor as there is a wide choice of allowable investments, so whether you are a very risk averse investor or highly speculative, there are options available to suit.
Once you have also worked out how much you want to save, your Charles Derby Consultant will guide you through all the paperwork too and take care of the whole process.
Pensions are for everyone!
Whether you are self-employed, an employee, a company director, business owner, partner, or even a non-earner, it is possible to take advantage of the valuable tax breaks on offer with pensions.
Tax treatment varies according to individual circumstances and is subject to change.
Pension plans today are very flexible and you can choose to pay in small regular contributions, make ad hoc payments or a combination of the two. Most people choose to start their pension with a regular contribution. Regular contribution levels can be set to suit your budget and the amount you pay in can be varied to take account of changes in your circumstances.
Tax relief on what you pay in
For all but the very highest earners (who may choose to pay in more than the generous Annual Allowance), the money you save in your pension will benefit from tax relief. This means that more goes into your pension than you pay yourself.
For employees paying basic rate tax, the relief on any pension contributions is provided automatically. This turns each £80 you save into £100 paid in. For non-tax payers, up to £3,600 can be paid in each year with this same tax relief. This means that although you are not paying income tax, you still get the benefit of a 20% uplift in the amount going into your pension.
For higher rate tax payers, a full 40% relief is available up to generous limits, with the first 20% being automated, and the remaining 20% provided through self assessment. This means that for every £60 paid in by you, £100 is invested in total.
What’s stopping you?
If you want to get your pension planning started, just give us a call. It is free to call us on 0800 849 1279 and we offer a no-obligation initial meeting so it doesn’t cost you a penny to find out if we offer the right service for you.