At Premier Financial Solutions we offer pension advice Cardiff and right across the UK. Whether you are employed, self-employed, or even retired already there are a number of solutions available. Utilising our expertise and experience, we aim to deliver the solution that is most suitable for your needs.
What is a Pension?
A pension is the savings fund that is built to support yourself in later life. You may have a workplace pension with your current or previous employer, your own personal pension and are also likely to have a state pension. Pension can be used to provide and income or lump sum in retirement or to provide a legacy to family after you pass away.
There are 3 main types of pension, and you can have more than one kind:
- The State pension
- Defined Benefit pensions
- Defined Contribution pensions
State Pension
The state pension is a regular payment, that people can claim when they reach their state pension age. State pension is a payment from the government, and once payment begins it is a secure income for life. Most people are entitled to some state pension, however how much State pension you get depends upon your National Insurance contributions.
Defined Benefit Pension
Defined benefit pensions (sometimes known as ‘final salary’ or ‘career average’ pension schemes), are workplace pensions set up by your employer. The amount you receive depends on a number different factors, however how long you worked and the amount that you earnt, both contribute to how much you will receive. Most Defined Benefit schemes have a set retirement age, however you might be able to take your pension earlier or later depending on the scheme rules. When you are entitled to receive your Defined Benefit pension, you normally have the option of taking some of it as a tax free cash lump sum!
Defined Contribution Pension
A defined contribution pension is a pension fund that develops as you or your employer make contributions to it. These can also be known as workplace pension or personal pensions.
Defined contribution pensions can be made up by regular contributions, lump sums or both. Contributions are normally entitled to receive tax relief, which adds to the value contributed. Funds that make up your pension are usually invested to further assist the growth of the fund. By conducting regular reviews, we can track and monitor the progress of your pension fundover time.
Since pension freedoms were introduced in 2015, you can gain access to your personal pension from age 55 and have the option to access up to 25% Tax Free cash.
For friendly and straightforward advice contact Premier Financial Solutions: 02920 099 150
Investors should remember that the value of an investment and the income received from an investment can go down as well as up, and they may not get back the amount they invested.