Published on May 26, 2018
slide 1: Private Pensions Guide It is now unlikely that the state pension will be sufficient to keep you alive comfortably when you retire. It provides only basic aid and also the government itself is keen to encourage individuals to conserve as much as they can to supplement their state pension and give themselves a comfortable income. Combined with better health in the overall population - meaning longer life expectancies - and - dwindling stock market returns over the last decade or so the so-called pension crisis is a call to action for individuals to plan their finances carefully and place an increasing number of cash aside to guarantee a secure and safe future for themselves. This article is the second of two manuals analyzing the fundamentals of mis sold sipps. The first guide concentrates on state pension provision while this one summarizes some of the possibilities for making private pension arrangements. Theyre intended for information only and dont constitute financial information. Its recommended that you speak to a financial advisor for professional advice on preparing your finances for retirement. Saving for the future There are tons of ways in which you can save for the near - savings accounts stocks and shares and property investment for example. But all of these are subject to tax. Pension schemes are much more tax-efficient as tax relief is provided on contributions made and the income they supply during retirement is tax-free. This is why pensions are a frequent way of saving for retirement. There are two main varieties of personal pensions - final salary and money purchase. The first could only be provided through occupational schemes but the second can be bought privately on a single basis. Final salary Final salary schemes also called defined benefit schemes offer a guaranteed income based on a percent of wages earned during your final year of work in addition to length of service with the company. It is likely to retire up to two thirds of your final wages.