Pension rules and regulations have been relaxed in recent decades providing savers with more options at retirement. Resultantly, a vast range of pension products have entered the market to give savers more flexibility and choice with their pension savings.
Whilst this freedom of choice is excellent for the prospects of savers, it has made the process of planning retirement all the more complicated and confusing.
Springfield Financial are Chartered Financial Planners and will help you build a retirement plan that makes your money go further in later life.
Retirement is one of life’s most significant milestones. Whilst retirement does not necessarily mean losing your income, it does likely mean a departure from secure full-time work.
People are living longer than ever - a 65-year-old retiree will likely live until 84 for men and 86 for women, with roughly a 14% chance of living to 100 and this means that pensions need to go much further, as even if you’re still working in your 60s, you will still need a pension to support you in your 70s and beyond.
Long-term care is another factor to consider - pensions can support care costs to prevent eating into your other savings.
Planning your retirement is a wise move, regardless of how old you are. Not only does proper pension planning make your money work harder, but it also provides peace of mind that your financial future post-retirement is secure.
Your Retirement Options
Pension finance planning is more diverse than ever, primarily because there are more pension options and products on the market.
Moreover, people tend to have more pensions now as the law requires employers to enrol most of their employees into pensions automatically. Dormant or ‘forgotten’ pensions in the UK might total a startling £19 billion - we can help you track down your old pensions and transfer them or consolidate them with your current pensions.
Springfield Financial has a wealth of experience in all types of pensions. We can advise you on;
- Existing pensions, new pensions and pension investments
- Pension transfers
- Pension tax relief
- Annual allowance planning (incl. carry forward, tapered and money purchase annual allowances)
- Lifetime allowance planning (incl. lifetime allowance protection)
- Pension sharing on divorce
Workplace pensions are accrued from employment. Employers are legally required to offer certain employees a workplace pension, but these tend to have a restricted range of investment options.
There are two main types of workplace pensions:
- Defined contribution pensions; employees and employers contribute a percentage of salary to the pension pot. Investment is usually made into a fund selected by the employee. At retirement, the employee chooses how to secure their benefits.
- Defined benefit pensions; also called final salary pensions, contributions are made by both employee and employer, however, the investment is managed by the trustees. At retirement, the employer pays a pension and lump sum, usually based on salary and length of service.
Anyone can also choose to save money in a pension scheme using a personal pension or self-invested personal pension (SIPP).
Personal pensions tend to offer a limited range of investment funds. Stakeholder pensions are similar, offering default investment types with low minimum contributions and charges.
Self-invested personal pensions, or SIPPs, are the most flexible type of pension. They offer savers a wide range of investment types that vary considerably from provider to provider, including:
- Commercial property
- Exchange-traded funds
- Government bonds
- Investment trusts
- Offshore funds
- Real Estate Investment Trusts (REIT)
- Stocks and shares
- Unit trusts
It’s possible to choose a SIPP in addition to a workplace pension or to consolidate and transfer old workplace pensions into a SIPP. SIPPs often provide greater investment choice which can result in greater growth potential.
Springfield Financial can help you choose a suitable pension and assist in your investment choice. We have in depth knowledge and experience of all pension types, as well as the various investment instruments available within a pension.
Unless you are an experienced investor, it’s highly recommended that you seek the assistance of a professional financial advisor before choosing your investments.
The Retirement Planning Process
The retirement planning process varies throughout life, as firstly, you’ll need to decide how much you want to contribute to your pension(s) and whether your current and old pensions are providing the best value under your personal circumstances.
We will assist you with:
- Choosing pension options and pension investments
- Your annual allowance, the amount of pension contributions that qualify for tax relief
- Transferring existing or old pensions
- Using carry forward to make extra pension contributions
- Bolstering your retirement savings with other types of savings products, including ISAs
- Periodically monitoring the investment performance of your pensions
- Reviewing your risk profile as your approach retirement
- Helping you understand the options available for withdrawing from your pension
- Pension commencement lump sum (tax-free cash) versus income
- Flexible access drawdown
- Uncrystallised fund pension lump sum
- Small pots
Financial Planners Preston
Springfield Financial, based in Preston, was established in 1979. We are Chartered Financial Planners as designated by the Chartered Insurance Institute (CII). Chartership is granted to those financial planners in the UK who show consistent dedication to their customers and continued development in the field of financial planning.
We are proud to be amongst the best financial planning advisors in the country and offer our services throughout Preston, the Ribble Valley, the Fylde Coast and the Lake District.
Our people-first, client-first attitude puts you at the forefront of everything we do.
We will work alongside you to put strategies in place to bolster your finances and drive financial success both now and in the future. Get in touch today if you have any questions or wish to book a consultation.