Pension Advice York
Pensions can be complex, our personal circumstances differ. For expert advice tailored for you contact Corville Wealth Management, your local pension specialist in York and North Yorkshire.
What is a pension?
A pension is a tax-free pot of cash you, your employer (and sometimes the Government) pays into, as a way of saving up for your retirement. At retirement, you can draw money from your pension pot or sell the cash to an insurance company in return for a regular income until death (this is called an annuity). Since the 2014 Budget you’ve been able to access your pension once you turn 55, taking as much or as little as you like, whenever you like. For pension advice, contact Corville Wealth Management…your local pension specialists.
Is a pension worthwhile?
The biggest benefit of a pension is the tax relief, which comes in two forms depending on whether you’re a basic rate or higher rate taxpayer. You get some tax back on the money you invest into your pension, while gains from the investments you make with that cash are largely tax-free.
How much should I put in a pension?
The simple answer of how much to put into a pension is, as much as possible as early as possible. Don’t delay. The sooner you contribute, the longer your money has to grow. For a more accurate assessment of calculating how much you need to retire, contact Corville Wealth Management, your local pension specialist. We will ask for information including when you want to retire, how much you and your employer are contributing, and whether you want your pension to be inflation-proof.
How much can I put in a pension?
There’s technically no limit to how much you can put in a pension. But, there are limits on how much tax relief you’ll get for doing so, and there are three different limits you need to be aware of:
An earnings limit.
An annual limit.
A lifetime limit.
For an full explanation or pension planning advice, contact us today.
What’s pension auto-enrolment?
For many years, your company may have set up and contributed to a workplace pension. Not all companies offered workplace pension schemes and fewer than one in three UK adults were contributing to a pension, auto-enrolment was designed to address this.
Automatic enrolment into a pension scheme
The auto-enrolment rules mean that if you’re an employee, your employer will be forced to offer you a pension scheme. By 2018 all employers by law will have to contribute to their employees’ pensions. You have the option to say ‘no’ to auto-enrolment if you don’t want to join. But it’s an opt-out rather than an opt-in scheme, so if you do nothing, you’ll be opted in.
What’s ‘salary sacrifice’?
Paying into a pension gets all taxpayers a tax break. But for an extra and easy bonus, salary sacrifice is worth considering. Salary sacrifice applies to a number of workplace benefits such as childcare vouchers or cycle-to-work schemes, not just pensions. It’s where you give up some of your monthly earnings while your employer puts it towards something else – in this case, personal pension contributions. As it comes out of your PRE-TAX salary and straight into your pension, you pay a reduced rate of employees national insurance (NI). Your employer will also pay a reduced rate of employer’s NI which gives them incentive to operate the scheme.
Should I take my employer’s pension?
If you’re employed, your employer may top up your pension as part of your benefits package, so absolutely consider it. This is effectively a pay rise, so don’t give that away, plus there’s no tax to pay on that contribution (subject to annual allowances). It may not be going into your pay packet, but it is cash going towards your future. But before you do, seek independent financial advice, we can tell you what’s actually going into your employers pension from your contributions and advise you if it’s the best pension product for you.
How do I get a pension?
Under the new auto-enrolment rules, many people will end up in a company pension so all you would need to do is go ahead with what your employer offers. To pocket any contributions your employer makes, you need to agree to be part of its scheme.
If you opt of your employers pension scheme for your own pension (where only you contribute) you will need to scour the market for the best pension product. It is best to get advice from an independent financial adviser (IFA).
What happens when I retire?
Once the money is in a pension, it can’t be withdrawn at will. It must stay there until you’re at least 55. (There are some extenuating circumstances where you can withdraw the money before 55). At that point, you can take 25% of it as a tax-free lump sum, with the rest ideally providing an income for the rest of your life…for full details of how to release money from your pension legitimately and how to avoid scams (such as pension liberation) contact Corville Wealth Management, your local award winning independent financial advisers.
Provided you’re over 55, you’ll be able to take as much as you like, when you like – though drawdowns above the tax-free 25% will be taxed at your marginal rate – so 20% if you’re a basic rate taxpayer, 40% or 45% if you’re a higher or additional rate payer, or the amount you’ve taken from your pension pushes you into that rate.
How safe is my pension?
With normal savings accounts, the simple rule is that up to £75,000 per person per institution is fully protected should your bank go bust. The protection provided by the UK’s Financial Services Compensation Scheme for pensions is very complex, and can vary with each product’s structure. Corville Wealth Management, your local independent financial adviser will help you understand how safe your pension is.
Pension Specialists York and North Yorkshire
For pension advice York and North Yorkshire, contact your award winning local Independent Financial Advisers, Corville Wealth Management.