Pensions & Retirement Planning

Pensioners relying purely on the state pension are currently living in an impoverished state, and the situation is not likely to improve. We recommend an early start to retirement planning, and regular reviews to ensure you are investing in the right way.

Saving via Pensions

This is the most tax efficient way to save, but the least flexible.
You benefit from tax relief on your contributions and almost tax free growth. Currently, 25% of your fund can usually be taken as a tax free lump, with the remainder providing an income in retirement. With the exception of some defined benefit schemes, since 6th April 2015, your entire pension fund is available as a lump sum, and it will not be compulsory to take an income from it. Benefits cannot be taken before age 55, and it will be important to consider the effects of taxation regarding how benefits are taken. Savings may be invested in a variety of assets.

Saving via ISAS and other savings vehicles

ISAS are also tax efficient, but your contributions do not benefit from tax relief. They are however very flexible. All assets are accessible at all times, and a tax free lump sum or income can be taken at anytime. Savings can be in cash or may be invested in a variety of assets. Other savings vehicles may be used which also have a high degree of flexibility, but are less tax efficient than pensions or ISAS.

Buy To Let Property

Property may also be used as a long term investment. The main advantage is that rental income should pay much of the mortgage costs, and mortgage interest is allowable against tax. Like any investment, there are risks, and there may be Capital Gains Tax to pay on sale. The option of keeping the property after you retire could be attractive in terms of the rental income it would continue to produce. For most purchases, from 6th April 2016, there will be a 3% surcharge on stamp duty, except for large landlords or corporate bodies. There will also be a restriction in tax relief on mortgage interest to basic rate tax, from 2020/21, which is being phased in, in stages, from tax year 2017/18.

The value of Financial Advice
We can help you plan for retirement over the longer term. We ensure that investments are compatible with your attitude to risk, and tax breaks are maximised. Regular reviews are recommended to ensure, as far as possible, that returns match expectations. Failing to do that is one of the principal reasons why some pensions fall short of expectations.

Retiring soon ?

An appraisal of all pensions and savings is recommended prior to retirement. This will ensure the highest possible income is obtained, and the effects of taxation are minimised.

The Open Market Option

You should not simply take your pension from your existing provider. We have top providers from the whole of the market to choose from. In many cases, an enhanced annuity can be obtained due to health, weight, occupation, or smoking status etc. There are also a number of other options to be considered in setting up your annuity, such as a spouses pension, a value protected annuity, an escalating annuity etc, to name but a few.

Pension Freedoms

Since 6th April 2015, new legislation allows much greater choice and freedom in terms of how you access your pension, and although lifetime annuities are still a valuable option, it is now possible to choose from a host of much more flexible options, or indeed, to access your entire pension, provided you are at least 55. Since this is a complex area with tax and other considerations, it wise to seek guidance from “Pension Wise” as a first step, and to have qualified professional advice before deciding what to do.

Free initial consultation

Please call us for a free initial consultation. If we arrange a product for you, we can be paid by fee. Terms are available on request.

As a mortgage is secured against your home, it could be repossessed if you do not keep up the mortgage repayments.

For mortgages there will be a fee of usually £100, and we will also receive a payment from the lender.

The FCA does not regulate some forms of Buy to Let mortgages.


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