A stakeholder pension is a simple, flexible, low-cost way of saving for retirement.
Any personal contributions made into the arrangement will attract tax relief. Your employer can also contribute to the plan if they agree to do so.
You can invest up to £3600 per year or 100% of your taxable salary each year.
It is possible to invest into a range of pension funds, which might include stocks and shares, property, fixed interest or cash. Stakeholder Pensions are usually restricted in the fund choices that might be available. Personal Pension or Self Invested Pension arrangements offer a wider range of investments, but this usually means the costs will be higher.
You can normally retire from age 55. At retirement, up to 25% of the value of your stakeholder pension can be taken as tax-free cash. The remaining 75% has to be used to provide a retirement income. Benefits can be taken in a variety of ways. You can decide how to take your income when it comes to retirement.
If you have not made any provision for retirement, stakeholder pensions may be the best option for you. Whether a stakeholder pension is the right type of pension for you will depend on your circumstances.
If you would like to discuss retirement in more depth please contact us.
The value of any pension funds can fall as well as rise. The amount of income available at retirement is not guaranteed.