The problem with pensions is governments changing the rules. The current government are doing a pensions review. Reports suggest they may reduce pension freedoms or bring back the minimum income guarantee rule, thereby forcing most people to buy an annuity (similar to the old rules before pension freedoms were introduced) I'm not sure how people are expected to make long term plans when governments constantly mess with the rules. Because of this, I'm favouring a stocks and shares ISA at the moment. The uncertainty around pension rules is a major concern I think.
All scare mongering based on no more than political bias from a very bias media. If you are worried about what governments will or will not do, what makes you think an ISA is any safer than a pension?
Hi Gumdrop, thank you for your comment and for supporting the channel. Your concerns about the Government changes to pension rules are completely valid. The uncertainty created by constant rule changes makes it hard for people to plan for the long term with confidence, especially when the possibility of reversing pension freedoms or reintroducing something like the minimum income guarantee could dramatically affect retirement plans. That would put the cat amongst the pigeons. Imagine being forced to buy an annuity? As interest rates fall, so do annuity rates and the income from them. That would be a backward step. The flexibility of pensions under the current rules has given people more control over their retirement income and these changes would not be popular at all. ISAs can offer more stability in terms of Government rules, and the tax-free withdrawals make them a very attractive alternative for those who are cautious about future changes to pension legislation. While they don’t have the tax relief on contributions like pensions do, the fact that ISAs remain flexible and predictable is a big plus. Our next video out tomorrow is about how we have "46 days to save our pension wealth from the Labour tax grab" which you might find interesting. Please keep watching and subscribe :-)
What is the relevance of £16760 as an annual tax free amount. I’m 55 currently, can I not take 12570 from the drawdown amount and then whatever I want from my 25% tax free pot? For example 12570 from drawdown and 20k from tax free pot, giving me 32570 tax free income. Sorry if I have misunderstood 👍🏻
Hi Dom, thank you for your comment and for supporting the channel. You're right, you can take £12,570 to your Personal Allowance (no income tax or NI) and take as much or as little of your tax-free cash whenever you like as long as your provider can do that for you - not all will be able to do it so check in advance. You're right to be thinking ahead and asking the right questions. My example was one of many to illustrate the options open to you. Let me know how it goes and good luck!! Our next video out tomorrow is about how we have "46 days to save our pension wealth from the Labour tax grab" which you might find interesting. Please keep watching and subscribe :-)
I often wonder if it is to late to start again in a pension plan at 63 years old. I have some plans and due to personal reasons I lost my job and the plan. Now back in work and I am curious if it is worth it
Hi RIch, thank you for your comment and for supporting the channel. While starting a pension at 63 might not give you as much time to save as someone starting earlier, it’s still worth considering because of the tax relief benefits, potential employer contributions, and the flexibility it offers in retirement. Every bit of saving can help make your retirement more comfortable, and it’s never too late to take control of your financial future. I have never had a client say to me "I wish I had less money in retirement!" Your ta relief will be a minimum of 20% plus your employer contribution of 3% of your salary. Our next video out tomorrow is about how we have "46 days to save our pension wealth from the Labour tax grab" which you might find interesting. Please keep watching and subscribe :-)
Great video as ever. as Gumdrop says, there is a lot of potential changes coming along, my gut feeling is that they will not do anything overly impactful, but are more than likely just going to make some changes around the contributions and tax.
Hi again Shaitan, thank you for your comment and for supporting the channel. I hope you're right but tinkering around the edges won't fill the mythical black hole. CGT, IHT, pensions, council tax, income tax are in the crosshairs. My concern is when they have all the additional revenue - how will it be spent effectively for our benefit? Our next video out tomorrow is about how we have "46 days to save our pension wealth from the Labour tax grab" which you might find interesting. Please keep watching and subscribe :-)
Hi Mind, thank you for your comment and for supporting the channel. I completely agree as I would hope you would have front loaded your spending in the early years to maximise travelling and experiences and helping the family whilst you are fit and healthy enough to do it - then slow the spending later in life. For many who are uncertain about spening, this is a basic rule of thumb guide. I will have a video in the coming weeks as to why the 4% rule should not be relied upon. Our next video out tomorrow is about how we have "46 days to save our pension wealth from the Labour tax grab" which you might find interesting. Please keep watching and subscribe :-)
