Building up a pot of money that can be used to provide an income in retirement With a defined contribution pension, the member builds up a pot of money that they can use to provide an income in retirement. Unlike defined benefit schemes, which promise a specific income, the income the member might get from […]

Salary-related pension based on the number of scheme membership years Some employers offer these schemes, also known as ‘salary-related pension schemes’. When someone retires from the scheme, it pays them a pension where the benefit is based on rules set out by the scheme.

Shopping around to obtain a higher rate Prior to the commencement of the pensions reform changes, historically purchasing an annuity has been the most common way of turning someone’s pension savings that they’ve built up over the years into an income that will last them the rest of their life. 

New legislation allows increased payment flexibility If someone is a member of a defined contribution scheme from 6 April 2015, they will be able to access their pension fund, in full, without needing to purchase an annuity. With a defined contribution pension, you build up a pot of money that you use to provide an […]

Taking advantage to legally minimise the tax paid T he main beneficiaries of the pensions freedom reforms are likely to be those who have built up relatively large pension pots, who will be using this freedom to avoid paying 40% tax when they draw it down under the new freedoms.

10 things about the wide-ranging changes you should know The pension system is completely being overhauled to enable individuals to take their defined contribution pension how they like in order to create greater choice and flexibility. These changes were announced in Budget 2014. From 6 April 2015, no matter how much an individual decides to take […]

Taking all of a pension pot as a lump sum When someone reaches retirement, they can take up to 25% of their pension as a tax-free lump sum (called the ‘pension commencement lump sum’). The remaining 75% has usually been used to purchase an annuity, a financial product that provides them with a guaranteed income for life, […]

Greater choice and flexibility about how retirees use a pension pot to fund retirement income T he 2014 Budget announced major changes to the way that members of a defined contribution pension scheme could access their pension savings. In March 2014, the Chancellor George Osborne announced changes to the pension world which would revolutionise the […]

During difficult economic times, one of the tools available to the Bank of England to stimulate the economy is interest rates. Lower interest rates mean that it is cheaper to borrow money and people have more to spend, hopefully stimulating the economy and reducing the risk of deflation.

An investment bond is a single premium life insurance policy and is a potentially tax-efficient way of holding a range of investment funds in one place. They can be a good way of allowing you to invest in a mixture of investment funds that are managed by professional investment managers.