What is compound interest and how does it affect you?

Einstein once reportedly referred to compound interest as the ‘eighth wonder of the world’, stating: “He who understands it, earns it, he who doesn’t, pays it”. So, just what is compound interest and when do you benefit from it? Whilst financial jargon can often seem complex, compound interest is actually simple and easy to take advantage of. The term refers to the principle that when you save money you can earn interest on not only your...

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7 things to review when looking at your pension

Research suggests thousands could be missing out on investment returns in their pension because they haven’t updated their retirement age. Remaining engaged with your pension can help you create a retirement income that meets expectations. So, what should you review when looking at your pension? 1. What fund are you invested in? Typically, a Defined Contribution pension will offer several different fund options for you to choose from. When you...

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How to make sure your pension lasts a lifetime

Thousands of retirees are shunning Annuities when they reach retirement age. Instead, they’re taking advantage of the opportunity to access their pension savings flexibly. It can be a fantastic way to match your income and lifestyle, but figures suggest many are withdrawing unsustainable amounts. There are many benefits to taking your pension flexibly. However, you need to keep in mind that you’ll be in control of when withdrawals are made and...

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Defined Benefit pensions: Is it appropriate to transfer out?

Please note: Transferring out of a Final Salary scheme is unlikely to be in the best interests of most people. Do you have a Defined Benefit (DB) pension? If you’ve seen the sums you could receive by transferring out, you might just be tempted. However, it’s not the right choice for everyone and it’s crucial to consider the long-term impact. Receiving a lump sum that’s probably many times the annual value of your pension might seem like...

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Could you face a pension shortfall?

One in three middle-aged Brits is set to retire on the State Pension alone and many more face a shortfall in their pension. It could leave a significant gap between expectations and reality. If you’re not sure what income your pension could deliver in retirement, checking sooner rather than later gives you an opportunity to plug the gap. Based on the spending habits of those that are already retired, Nationwide estimates that those retiring in...

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Weighing up the pros and cons of different Pension Freedom options

Retirees are increasingly concerned about their money running out. With more responsibility placed in the hands of the individual, around how, when and how much income they’ll withdraw from their pension, it’s no surprise. Pension Freedoms were introduced in 2015 with the aim of giving retirees more flexibility in how they used their retirement savings. The changes reflect a shift in retirement. In the past, many retirees followed a fairly...

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Pension changes to be aware of for the 2019/20 tax year

As the start of a new tax year begins, it’s often a time to consider how your financial plan is shaping up and ensuring it’s still relevant for aspirations and goals. You may be thinking about how you’ll use your ISA (Individual Savings Account) allowance this year or how to make the most of investable assets. One key area you should be considering is your pension. As you plan for retirement, there are three important changes to keep in mind...

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Using your pension as an inheritance

When it comes to planning how your estate will pass to your loved ones, there could be a crucial element that you’re missing; your pension. While you’ve probably thought about who you’d like to inherit your home, investments and savings, pensions are often forgotten about. It’s easy to see why, after all, while you regularly make contributions to your pension you can’t access it. As a result, it often ends up being an afterthought during...

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