Pension Saving: Maximising Your Savings
It’s so important to start early when it comes to saving for your pension. Although this may seem daunting, it’s actually a lot simpler thank you think.
Make sure to take advantage of what is being offered to you
When saving for retirement, it’s important to ensure that you take advantage of everything that is being offered to you. This can help you to maximise your savings in the future.
If you are self-employed, you may be able to receive support from the government in the form of income tax relief if you are paying into a private pension scheme, as long as the contribution doesn’t exceed £40,000 per year.
Currently, the auto-enrolment scheme is underway, meaning that your employer will have notified you of you being signed up automatically to their pension scheme, where they will contribute a minimum of 1% of your salary. If you choose not to receive this, you could be missing out on a contribution which will increase in the years to come.
Look around and make an informed decision to manage costs
If you’re looking to maximise your savings for a comfortable way of living in the future, it’s important to decide upon the most cost-effective solution that is best for you.
For example, if you are looking to have more involvement in managing your pension fund, it may be worth looking into a self-invested personal pension, which will give you access to a range of investments.
You could also consider looking into a venture-capital trust (VCT) or an enterprise-investment scheme (EIS), which may be a useful option if you are a high-earner looking to reduce tax liability. These invest in businesses that are at an earlier stage.
Another option for reducing costs is to ensure you choose a fund that has the correct balance of cost and return that will suit you. A good way to ensure you make the best decisions here is to contact a local financial adviser to help you work through your options and find the best solution for you.