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Saving For Retirement

Overview
It would be fair to say that very few people will look forward to a happy retirement if they solely depend upon the state pension benefits. However, encouraging people to save for the longer term requires a greater understanding of the investment vehicles that are available. There are many different approaches to saving for retirement; some people have bought properties to rent out, others may inherit wealth and some people will simply save in banks and building societies. 

Not withstanding the above pension products should be a consideration when saving for retirement

A pension is just a ‘wrapper’ around an investment
I have heard many people criticise their pensions, citing them as a poor investment. It is important to recognise that a pension is an investment ‘wrapper’ it is not necessarily the ‘wrapper’ that is a poor investment; moreover it is likely to be investment funds that may not have delivered the expected investment returns. Do not dismiss pensions because of a poor performance experience

Tax reliefs
There are very few other investment vehicles that are on a par with pension products in respect of the tax relief’s that are available

Self-investment
It is possible to make your own investment decisions for your pension savings; the more popular self-investment options include commercial property and equities (shares).  If you have £100,000 or more saved in pensions and you also have other investments a self-invested pension might be for you

Existing Pensions
Have you got the right pension for you
If you have a number of pension policies you should consider reviewing the charges; the Financial Services Authority (FSA) have issued publications suggesting that the vast majority of policies taken out before the late 1990’smay have high charges compared to the charges for products taken out thereafter. High charges could erode the value of your pension fund, so it could be in your interest to review your pensions. However, on the flipside you need to take care because older policies might have certain guarantees that would be lost if the fund value was transferred to another plan.

If you have any retained benefits from a previous job, it might be in your interest to review whether it is appropriate to leave the funds with an ex-employer or possibly consider a transfer to a private pension arrangement even if you have considered the option before because legislation and / or your personal circumstances may have changed since you last consider a transfer.

Regular reviews
It is highly recommended that you regularly review your pension planning arrangements, to take account of changing legislation, changes in your personal attitude towards investment risk and changes in your personal circumstances. Furthermore reviewing the investment mix is also important; this would help maximise your retirement savings

Sovereign Asset Management is a trading style of Sovereign Asset Management (Bristol) LLP, which is authorised & regulated by the Financial Services Authority; registration number 434895. Sovereign Asset Management (Bristol) LLP is registered in England & Wales, registration number OC313334. Any guidance contained within this website is subject to the UK regulatory regime; as such the content is for consumers only based in the UK. The FSA does not regulate all forms of Protection, Business Assurance or Tax Planning. Where this website offers links to any other websites, Sovereign Asset Management (Bristol) LLP have no control over the content and cannot be held responsible for the content or any material transmitted to your computer.