Workplace Pensions

Workplace Pensions

Everyone in the UK needs to save for their retirement, and most do this by contributing to a pension. The state pension will not be enough for most people and will not provide enough for you to enjoy retirement!

There are many different types of pension, such as personal pensions, workplace pensions or company pensions, and Self Invested Personal Pensions (SIPPs). Understanding your options will probably require specialist pension advice, we can give you that advice and help you plan for your future.

If you are an employer, we can help with Workplace pensions, Auto Enrolment and NEST pension advice for you and your business.

A workplace pension is a way of saving for your retirement that's arranged by your employer. Some workplace pensions are called 'occupational', 'works', 'company' or 'work-based' pensions.

A percentage of your pay is put into the pension scheme automatically every payday. In most cases, your employer and the government also add money into the pension scheme for you. The money is used to pay you an income for the rest of your life when you start getting the pension. You can usually take some of your workplace pension as a tax-free lump sum when you retire.

If the amount of money you've saved is quite small, you may be able to take it all as a lump sum. 25% is tax-free, but you'll have to pay Income Tax on the rest.

Auto Enrolment

Auto-enrolment is a government initiative that requires all employers in the UK to set up a company pension scheme and automatically enrol all eligible employees. In this way, workers can save for an additional income in retirement on top of any state benefits to which they may be entitled. Every employer must automatically enrol workers into a workplace pension scheme if the worker is:

  • • aged between 22 and State Pension age
  • • earns more than £10,000 a year
  • • works in the UK
  • • For more advice on auto enrolment call Lifetime-IFA on 0800 0149 370

For more advice on auto-enrolment call Lifetime-IFA on 0800 0149 370

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Self-Invested Personal Pensions (SIPPs)

One of the main reasons SIPPs are popular is the control and flexibility they provide. Your SIPP will be unique to you, based on what you want to invest in and not limited to a few funds.

A Self Invested Personal Pension allows the plan holder much more freedom than a personal pension or a stakeholder pension. It also requires active management and investment expertise and charges may be higher than for a personal pension or stakeholder plan. The plan holder can appoint a stockbroker, fund manager or have control over the investment strategy themselves.

Your SIPP could borrow money based on the value of the fund for investments that will benefit the scheme (for example, commercial properties). It can borrow, at any time, up to 50% of the pension's assets.

Retirement Planning

Planning for retirement is extremely important especially as people are living longer and are active for longer. To enjoy your retirement, having a suitable income to support your standard of living is essential. With annuity rates being low it is important to manage your pension fund and have regular pension forecasts so we can determine the level of your contributions needed and where to invest them to get your desired income in retirement.

Purchasing an annuity isn't the only option in retirement as many people are looking at income drawdown as an alternative to purchasing an annuity.

Annuity Advice

Purchasing an annuity is the most common way of turning all your pension savings, which you've built up over the years, into an income that will last you the rest of your life. An annuity is a contract guaranteeing you an annual payment each year until you die. You can't change your mind once it's done, so it is vitally important that you get advice and get the most from your pension possible.

Arranging an annuity is a complicated process, so it's important to seek professional and independent advice. It's vital that we research the whole market for you to get the best annuity rate, so we make the most of what you have saved up until your retirement.