Pension Awareness Week - How Simpson Wood Financial Services can help

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Shabab Gulfraz | 17th September 2020

Pension Awareness Week - How Simpson Wood Financial Services can help

As Pension Awareness Week draws to a close we wanted to show how we are able to help you with your pensions.

Within the UK we are currently facing a pensions crisis. Putting it simply, as a nation we simply are not saving enough for our future. This issue has been magnified over the past decade, as wage growth struggles to keep pace with inflation leading to contributions over and above the minimal criteria being a rarity. The lack of advice being provided to members within workplace pensions is also a problem. Should members receive advice, or even investment guidance, then a certain level of accountability could at least be attained, if not additional growth.  

In reality, should there be no alternative pension planning, then the maximum new state pension entitlement is £175.20. You are entitled to the maximum amount if you have paid national insurance contributions or received national insurance credits for a total of 35 years. With the cost of living taking a large chunk of salary/profits, it is worrying that at retirement, if there is no provision, then it will lead to many people not having the standard of living they are accustomed to, or need in retirement.

At Simpson Wood, one of they key areas of planning for many of our clients is to review what happens, when you reach retirement, or when you sell your business?

So why do our clients invest into pensions? Well one of the reasons is to ensure they are tax efficiently building their wealth for the future. A pension contribution for a director or employee is treated as a business expense; therefore, reducing the level of corporation tax. The pension fund will grow free of any taxes whilst you are invested, and at the time of retirement, you are able to take 25% tax free.

Contributions by individuals attract tax relief at your highest marginal rate of tax; therefore, a £600 contribution for a higher rate tax payer is currently equal to £1,000.

Our approach as a business is to offer all our clients a complimentary financial planning review with one of our advisers. Our advisers always provide a full complimentary financial planning health check with a view to getting to know our clients, and what they need or want from their savings/pensions in the future. We then tailor advice to our clients based on their needs and requirements, rather than using a one solution fits all approach.

One of our success stories recently is a client who whilst undertaking advice relating to their financial position located a pension with £175,000 of savings that had not been located, or reviewed for a long time.

Our ethos is advice should not be transactional, but instead advice should be provided on an ongoing basis. Continued oversight and ongoing management of your pension pot is essential because changes in personal circumstances, as well as the macroeconomic environment can affect your ability to achieve your retirement goals.

To arrange a complimentary financial planning review please contact Shabab on 01484 534431 or email Shabab.gulfraz@simpson-woodfs.co.uk