How to Find Out the Best Pensions in the Market Today
Retirement is an important milestone in your life so it is important to know about the best pensions in the market today. The UK government provides pension schemes to all its citizens but it might not be enough to guarantee you a comfortable life during old age. Knowing your options will lead to better planning for your future.
The Best Pensions for Different Types of Individuals
Personal and Stakeholder Pensions
These are the best pensions for anyone who is employed, self-employed, or currently not working but have the capacity to build a retirement fund. There are several types of pension schemes, as long as your annual contribution is not over £255,000 or your lifetime payments do not go beyond £1.8m. Unlike other conventional plans in the UK, it gives more flexibility to the plan holders in terms of managing and using their funds for different investment opportunities and business transactions.
Occupational or Company Pension Schemes
Working individuals have the right to be given this type of pension scheme. The two types of occupational or company pension schemes are the defined benefit schemes (final salary schemes) and the defined contribution schemes (money purchase schemes). The company pays a specific amount to the pension fund (before tax) while the employee contributes a part of his/her salary (after tax). Different rules apply to public and private companies. If you belong to a company that offers attractive benefits and tax relief, you have the best pensions you can rely for your retirement.
Self-Invested Personal Pension Schemes
These are the best pensions for profit-driven individuals who have a keen eye for business. With these types of pension schemes, the plan holders have more control over the way their money is going. Depending on the scheme, they can even borrow as much as 50% of their fund to be used as capital for different investment portfolios.
Basic State Pension
The UK government sets a retirement fund for all citizens who have paid their National Insurance Contributions (NICs) during their qualifying years (16-65). During the State Pension Age, a single person is given £107.45 a week while spouses/civil partners can get £171.85 as of 2012-13.
State Second Pension
The State Second Pension (S2P) or the State Earnings Related Pension (SERP) is a top up fund to the Basic State Pension. It is available for employees earning more than £4,940 a year, as of 2009-10.
Deciding About the Best Pensions for You and Your Loved Ones
It is never too early to save up for your retirement. Find out more about the best pensions that will satisfy your specific lifestyle needs and business expectations by talking to our reputed financial advisor. It can help you weigh the pros and cons of the different types of pension schemes so you can benefit from it during your old age.