Sooner or later we will retire, and the decisions we make today are the ones that will determine the standard of living we will enjoy in the future. If you are approaching your retirement there are some very important choices you need to make that will determine how much income you live on once retired.
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Self-Invested Personal Pensions
If appropriate to your particular situation, a Self-Invested Personal Pension (SIPP) could be another option to consider if you require the flexibility to choose where your pension money is invested. SIPPs are now also open to people of lower incomes – not just those with commercial property.
Workplace pensions
MONEY IS USED TO PAY YOU AN
INCOME FOR THE REST OF YOUR LIFE
A workplace pension is a way of saving for your retirement that’s arranged by your employer. Some workplace pensions are called ‘occupational’, ‘works’, ‘company’ or ‘work-based’ pensions.
Minimising potential taxes and duties on your death
IMMEDIATE ACCESS TO YOUR PENSION FUNDS, ALLOWING YOU TO TAKE OUT WHAT YOU WANT, WHEN YOU WANT IT
As your wealth grows, it is inevitable that your estate becomes more complex. Money saved via a pension can be passed on to a loved one, usually outside their estate and free of any death tax, provided the pension fund has not been touched and they die before age 75. People fortunate enough not to need immediate access to their personal pension may therefore decide not to touch those savings for as long as possible.
Income drawdown
If you decide that you’re not ready to convert your pension fund into retirement income by buying a lifetime annuity, but you do need funds, you have a few options. These are often known as ‘income drawdown options’.
Enjoy the time of your life
HAVE YOU GIVEN FULL CONSIDERATION TO YOUR LONG-TERM PENSION INVESTMENT STRATEGY?
Retirement planning involves thinking about your plans for the future now – that means investing your money with the aim of maximising its value ready for when you retire. Careful financial planning, the right mix of assets and starting sooner rather than later could all help lead to the retirement you are looking for. Many years ago the traditional view of saving for retirement was to simply put your money into a pension, with few decisions to make in the run-up to your retirement date and no choice over how the pension was taken.
Time to aim for higher returns
When it comes to taking investment risk to secure a higher return, those aged 55 and over are most likely to be taking the lead with Stocks & Shares Individual Savings Accounts (ISAs), according to research from Standard Life (08 April 2013). Over one in ten (11 per cent) of 55 and overs invest in the stock market via their ISA, compared to just 7 per cent of 35 to 44-year-olds.
It can be reassuring to take a long-term perspective
As wealth grows, so too can the complexity of its management. Our approach is to cut through complexity and offer you clear guidance to achieve your goals. Today’s challenging economic and global conditions, coupled with uncertainty in Europe, North America and China, have combined to create a degree of cautiousness among many investors. A long-term investment strategy will provide you with a clear advantage during uncertain times.
Spreading risk in your portfolio
Investment trusts
Investment trusts are based upon fixed amounts of capital divided into shares. This makes them closed ended, unlike the open-ended structure of unit trusts. They can be one of the easiest and most cost-effective ways to invest in the stock market. Once the capital has been divided into shares, you can purchase the shares. When an investment trust sells shares, it is not taxed on any capital gains it has made. By contrast, private investors are subject to capital gains tax when they sell shares in their own portfolio.
