Do you have a Personal Pension plan?
If you are like most people you’ve probably not looked at your Pension plan since you took it out, never mind reviewed regularly it to see if it’s on track to give you a comfortable retirement. And with some of us having more than one pension, this is becoming increasingly difficult to do.
There are a number of benefits to be had by keeping tabs on your pension. Firstly, the difference between a good and bad performing pension fund is a real eye-opener.
Here’s a quick illustration:
A study between 2003 and 2013 of two separate pension funds each with £100,000 invested, with no further contributions made over a 10-year period was staggering.
Actually shrunk by 0.35% on average every year and ended up with £95,000 (£5,000 less than it started).
Grew on an average of 11% a year. This resulted in the fund being worth £282,000 (£182,000 more than it started with).
Tax Free Lump Sum
A male (lets call him Jim), who is 65-years-old this year, is in good health and is looking to retire soon.
Pension A would have given him only £23,750 as a Tax Free lump sum.
Pension B would have given him £70,000 Tax Free lump sum.
Had Jim decided instead not to withdraw his tax-free lump sum and purchase a level annuity with his £95,000 he would have received an income of around £400 a month income.
Alternatively, had Jim regularly reviewed his pension – ensuring his money was always with the best performing provider and not paid excessive charges – he would have been able to buy an annuity with his £280,000 and receive £1,400 a month income.
This is a marked difference of £1,000 a month – for life!
If you have a Personal Pension which you have not reviewed in some time or are perhaps over 55-years-of-age and considering reviewing your options, then why not speak to Scottish Pensions. Our advisers are on hand to offer a Free Consultation, whether it’s in your home or in our offices or even just over the phone.
Simply compete the Enquiry Form opposite or call 0141 465 1909 to speak with an adviser. Lines are open – Monday to Friday: 8.30am – 7pm