Pension Planning Southampton

When you are thinking about pension planning Southampton

, Eastbourne or Torquay may feature in your plans. Many people choose to move to one of the UK's seaside resorts when retiring. Others look to be closer to friends and family or even to move broad. Even if you stay put you will need sufficient funds to enjoy your freedom.

Whilst putting money into savings account over the years or investing in property are both ways of planning for the future, there are a number of benefits to investing in a pension. If you are employed then you may be automatically enrolled in a workplace pension under the Government's automatic enrolment scheme that came into effect in October 2012 and that will be implemented over the next five years.

One of the key benefits of a workplace scheme is that your employer is also required to make contributions to the pension on your behalf. Even those who are not automatically enrolled may be able to join their workplace scheme.

A personal pension plan is another option. You can arrange such plans yourself and have the freedom to choose a provider and the level of investment that you want to make. Such plans are money-purchase schemes, meaning that the amount that you will get back depends on how much you invest, how well the investment does, the level of charges that apply and annuity rates at the time that you draw on your pension.

Whatever type of pension you choose, you will usually benefit from tax relief on the contributions you make to the scheme. As a result, if you invest 80 the tax relief increases this to 100.

When looking at pension planning, you will also need to think about the age at which you will retire. If you are looking to retire early then you will need to manage without your state pension for a while. Whilst you can draw on workplace or personal pensions early, there is an impact as you will have saved for a shorter period of time yet will be drawing on the pension for a longer one.

Whatever age you are, it is important to make sure that you have appropriate financial arrangements in place to provide you with an income when you retire. When you are pension planning, you may want to travel the world, study or simply enjoy a more relaxed pace of life. By spending some time providing for the lifestyle you want now, you can turn your dreams into reality.

by: Philip Loughran

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