When should you start a pension?

Ideally, you should start making contributions to a pension as early as possible.

Personal Pension plan benefits are on what is called a money purchase basis. That is, the eventual benefits will depend on how big your pot is and so size does matter.

The size of your pension plan will depend on a number of factors such as term to retirement, contributions made, growth achieved, costs incurred.

Typical private pension per year at age 65 if you saved £250 per month


Based on simplified long-term model of 7% annual growth, 1% annual management charge, 2.5% inflation. Actual pensions would vary and depend on investment returns.

How much do I need to save?

This will depend on what income you wish to retire on, and the factors listed above, together with affordability of regular pension contributions and what level of investment risk you are prepared to accept in order to grow your pension fund.

An independent financial adviser can discuss these aspects with you, analyse your attitude to investment risk, and give you a plan of what is required. Most advisers will provide you with a free initial consultation to ascertain what you are trying to achieve and give you ideas on the best way to go about it.

Factors such as affordability, investment risk and anticipated retirement age have a direct effect of the size of your pension. It is therefore important that a suitable plan of action is established from outset, and that your pension is reviewed annually to ensure that you are on track to achieving your goals. An independent financial adviser can take away the headache of reviewing your pension and provide you with advice on how to stay on track.

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