Start your career with pension plans

Planning early is the first step to being financially successful throughout life, including retirement.

07:23 08 December 2013

Beginning a pension is one of the best things you can do. There is no perfect time, but it is better to begin now rather than waiting for a time you might believe will be better in the future. All too frequently, finances may be tight for a longer period of time than you might expect and you suddenly are out of time to try and build your savings for retirement. 

 

There are many benefits to establishing a pension: 

• Investment income is free from taxes.

 

• Up to 25% of your retirement fund is available as a tax-free cash sum by the time you reach age 55 or older.

 

• Allows you to benefit from a source of income when you’re no longer able to work.

 

• Contributions have tax relief at your highest rate of taxes in most cases. 

 

• Automatic enrolment provides a pension account without a series of complicated steps. 

 

• Employers are required to make contributions of some sort in addition to the contributions you make.

 

• It is possible to set up additional pensions to help your financial security. 

 

• You have the ability to choose from multiple pension options. 

 

• Financial advisors are available to assist people with pension decisions. 

 

There are two basic types of pension styles. There is a personal one, commonly known as a stakeholder pension or SIPP, or a workplace pension that is established by an employer. Since employers are now required to give contributions towards your pension, it is wise to take full advantage of the funds. These funds are essentially free contributions that can help sustain your future financial needs. If you want to know more about pensions, and the differences between various pension plans, you may consider speaking with a financial advisor who understands what those differences entail and how they will potentially affect your future.