Pension And Retirement Planning

The state pension only provides a basic income in retirement, and if you really want to enjoy your retirement – continuing your existing hobbies, taking up new ones, travelling etc. – it is likely you will need to make additional provision. Far fewer people have access to a generous final salary occupational pension scheme than was the case a generation ago, and the age at which you can take your state pension is also set to rise several times in coming decades.

There are real benefits to starting your retirement planning early in life, but whatever stage of your working life you are at, it is never too late to start. Tax relief is available on your pension contributions at your highest rate of income tax, an advantage not available with any other form of savings. For a basic rate taxpayer, for every 80p you contribute, the Government adds another 20p.

McPhail Financial Services can guide you through the wide range of retirement savings options available. It is also important to regularly review your pension arrangements to ensure they are on track to provide sufficient retirement income, and the assistance of a professional adviser can also be invaluable in this respect. For example, you and your adviser can review the levels of contribution you are making, the amounts you are paying in charges and the risk profile of your existing pension investments.

McPhail Financial Services can provide pension advice services to:

• Employed persons seeking to maximise retirement income

• Self-employed persons seeking to maximise retirement income

• Employers needing or wishing to provide a pension arrangement for their employees. Employers could be forgiven for feeling confused by exactly what their legal obligations are in this area, but we can help you through this and take the worry off your mind.

If you are nearing retirement age, you may benefit from the advice of a professional adviser as to how to get the most out of the capital you have built up in your pension funds and to have this delivered in the most tax efficient way. You do not have to take the annuity offered by your pension provider, and not only can you take an annuity from another provider, but there are other options available to you as well such as leaving your money invested and drawing an income or taking part and in some cases all as a lump sum.

Remember that this is a crucial decision. Once you have made a decision about how to receive your retirement income, you may not be able to change your mind. This makes it the stage of life at which the assistance of a professional financial adviser is perhaps of greatest benefit.

The recommended solution can take account of factors such as:

• How much financial risk you wish to take with your pension fund

• What age you plan to retire at, whether you intend to retire completely with immediate effect, or whether you intend to continue working in some capacity for a while longer

• Whether you wish to provide for your spouse, civil partner and/or dependants when you die

• Are you in poor health? If so, you may qualify for enhanced rates should you require an income for life via an annuity

• How much income will you need in retirement and is this income realistic when looking at your pension fund

The value of pensions and investments and the income they produce can go down as well as up and you may not get back the full amount that you originally invested.

Past performance is not a guide to future performance.

You should not rely on this information to make important financial decisions.