There’s no doubt that we’re in a time of considerable change when it comes to pensions, with a great many people unsure of whether or not they should take advantage of the new freedoms and how they can best put the new system to work for them. As well as the positive things you can do with your pension, there are a number of things you should probably avoid doing with your retirement funds too.
A third of people aged over 50 who are employed in the private sector are now planning to retire later than they previously hoped, Aviva’s latest Working Lives report reveals.
Before the March 2016 Budget there had been much speculation that the Chancellor was planning big changes to the tax relief on pensions. However, just before the Budget, the Treasury scotched rumours of such changes and subsequently there were no changes to pension savings tax relief in the forecast Budget.
Google searches during 2015 in the UK for the term ‘pensions freedoms’, including other variants with and without plurals, have increased more than ninefold, according to the latest data gathered from the search engine.
In the lead up to the budget announcement, George Osborne seemed to bow to the pressure David Cameron and other members of the Conservative Party were putting on him to soften his approach when it comes to pensions and tax relief.
There’s a lot that’s likely to change about your pension in the near future, which in turn will have an impact on all sorts of other factors regarding savings for your retirement. Depending on what changes the government imposes on how pensions are taxed and the amount of tax relief allowed on pension contributions, you may end up needing to pay considerably more each month towards your pension, or even end up working several years longer before you can retire.