Pensions

A few facts about personal pensions

  • They are not complicated.
  • They can provide you with a decent standard of living when you retire.
  • They can be passed onto your family and be exempt from Inheritance Tax.

But for all of this to be true you need to set them up correctly in the first place and review them on a regular basis. It’s not enough to take out a pension plan and then never look at it again.

Many people view pensions as a fixed or static entity where you just pay in and forget about it. But just like a mortgage, pensions need to be reviewed and changed over the years to take advantage of the differing rules and rates as they become available and which may better suit your needs. Think about it this way: if you took out a mortgage years ago when interests rates were 15%, by now you would have reviewed it several times to keep it up to date with the latest mortgage lending rates. The same principle applies to pensions. They should be reviewed regularly so that, when you do retire, they can provide you with what you need.

LTA (Lifetime Allowance)

There is a limit to how much you can contribute to a pension fund called the LTA (Lifetime Allowance). The current limit is £1 million which may sound like a lot but it happens all too frequently that contributions can go over this limit without the plan holder even realising it. Any pension fund over £1 million is taxed at 55%. The higher your earnings the more your pension contributions may be restricted but there are tax-efficient alternatives that can limit the impact of these ‘taper’ rules.

It’s never too soon to think about your pension

Whatever your current circumstances – from just starting work to approaching retirement, I will work through all available pension options with you, taking the time to make sure you understand them. We will then work together to put our agreed plan into action.

Please contact me for an initial chat and to and arrange a mutually convenient appointment to review your pension options. An initial meeting is free of charge and without obligation.