Pensions

Many of today’s workforce believe they should be able to rely on the Government to provide a good state pension, even with an ageing population. So why should we all save for retirement? It is becoming more and more evident that Planning for Retirement should be addressed sooner rather than later.

The real value of state pensions will reduce even further in the future as the proportion of older retired people in the population increases, and the proportion of working taxpayers reduce. It is therefore essential that you save for your retirement in the most tax efficient manner possible and we at Compass IFS can help you plan for retirement. Retirement was once called the longest ever holiday you have in your lifetime!

When those now approaching retirement started work, people retired at 65 and died at 70. Now they hope to retire at 60 and will probably live to 85 or 90. No wonder the pot of state pension money is running low. There has, in some cases, been mismanagement of funds, but mostly it is simply the way the market works. As people have been told for years, the value of their investments can go down as well as up. This means that many will have to work longer, or save more, to pay for a decent old age.

We should be grateful that higher living standards now enable us to survive for so long. We are thankfully living longer but unhappily the State does not have the funds to maintain our lifestyles when we retire.

Does this mean taking out a Personal Pension Plan? Perhaps a Stakeholder Plan? What is a Defined Benefit Scheme? What about a SSAS or a SIPP? Perhaps property or art?

What are these things anyway?

How do we afford to live now AND save for later?

Quite a minefield - and to complicate matters no two people are the same.

Our advice is twofold and simple; speak with a Compass Adviser, and do it now!