A pension is a long-term savings plan where regular amounts and/or once-off payments are built up into a fund for retirement. Starting a pension is a very important step in your life as it helps to secure your future and provide you with the lifestyle you have planned for when your working life is over.
The reality is that the majority of us will need to save a significant amount to maintain our current standard of living when in retirement. So, it is important to take the time to calculate how much you realistically need to save so you can afford the lifestyle you are looking forward to when you retire. The easiest way is to start small and gradually build your fund, increasing contributions when possible.
It is never to early to start a pension, in fact the earlier the better!
Benefits in setting up your Pension today are:
The State Pension is Under Pressure: With the amount of people that will be retiring it places huge pressures on government finances so there is a possibility that the current state pension benefits will not be financially sustainable for the government and as it has been seen the government try to defer the age of when you can claim this benefit, so it is unknown what age you will be when allowed to draw this.
Life Expectancy is Increasing: Having 20 years of living from the age that you retire means that you will need a big enough fund to keep you going for those 20 years, so starting a pension now will help in having enough saved.
Income Tax relief: For contributions paid into a pension you can claim tax relief meaning you are saving even more! For every €100 invested into a pension, people on a 20% tax rate pay €80 and if you are on a rate of 40% you pay €60.
Tax Free Lump Sum: When you retire you can receive 25% of your accumulated fund tax free, up to a limit of €200,000.
Variety of Investment Options: Now there are many options available in the market that your pension will be invested in a way to suit you! You can chose from a large variety of funds ranging from Lower risk to higher risk,
If you are interested in starting your Pension we have attached below a pension calculator by Zurich Life and if you wish to discuss your options further or even if you want to review your current pension contact us and we will be happy to assist you in ensuring you can achieve your financial goals in retirement.
Protect your financial future with this Pension & Retirement Calculator from Zurich Life
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