UK Personal Pension Guide
Essentially, a personal pension is simply a way of saving that makes sure that when you retire, you can live comfortably. Pension plans have major tax benefits in the UK which makes them the most suitable savings scheme for most people.
Stakeholder pensions are a popular category of personal pension that generally have the most flexibility and lowest charges.
To take out any kind of personal pension, it does not matter if you are in employment under PAYE or you are self-employed. In fact, even if you are unemployed you can still take out a pension. You do have to be aged under 75 and over 18.
If you are a contributor to an occupational pension scheme, it is also possible to take out another personal pension. You can contribute to as many pension plans as you like and you can put as much money into each as you like. There is a cap on the total amount of tax relief you can get, though.
Information on how to obtain independent financial advice should be obtained from an experienced adviser. You can click on the link on the right for a no-obligation chat with an independent pensions expert.
Personal pensions should provide at least one of these benefits:-
- a pension through retirement, that can commence at any age between 50 and 75 (changing to between 55 and 75 by the year 2010)
- a lump sum free of tax upon on retirement of up to a quarter of the total pension fund (the pension fund includes all your contributions plus any interest and bonus payments).
- a pension that can be paid out to your dependants / spouse upon your death.
- a lump sum, free of tax, that can be paid out to your dependants / spouse upon your death.
