The fundamental idea of a personal pension plan is simple. You put money into a savings fund and it hopefully grows in value. At retirement, you have several options which are usually designed to replace some (or all) of your employment income.
A pension is a long term investment. The fund value may fluctuate and can go down. Your eventual income may depend on the size of the fund at retirement, future interest rates and tax legislation.
With pensions being most people’s second-largest asset, they can become a major consideration in any divorce settlement.
We all know it’s important to plan for retirement, but many of us are still not planning well enough. Despite all the media headlines and Government initiatives, many of us still have a ‘tomorrow will do’ attitude. This is worrying for one simple reason – we are going to live longer than most of us think. This article explains further.
Personal pensions may be suitable if you are self-employed, if you are not working but can afford to put aside money for retirement, or even in addition to a company pension.