Many people have not understood the tax implications of drawing down their money, meaning that savers withdrawing pension cash are handing over millions of pounds in income tax.
Don’t forget income tax when drawing your pension
Pensions are changing. Old-style defined-benefits pensions are disappearing. State coffers are running dry. And the government is constantly fiddling with the pensions rules. A comfortable retirement is by no means guaranteed.
So now more than ever it’s vital that you build up a healthy pot of money that you can draw on to fund your retirement. At MoneyWeek, we can help you do that. Not only accumulating your pension pot throughout your working years, but also making sure it produces the income you need to enjoy your retirement.
Your 3 pension options in 3 minutes from QR on Vimeo.
Latest articles on pensions
Asos: setting the trend when it comes to savings
The retailer’s plan to offer a range of savings options may inspire others, says David Prosser.
Pension withdrawals: an emergency best avoided
Many savers are paying too much tax on their pension withdrawals, says David Prosser.
Painfully slow pension transfers
Ministers warn pension providers to stop dragging their heels. David Prosser reports.
Why it pays to grumble about pensions
Not enough people whinge about their pensions, says David Prosser. But those that do have a point.
VCT tax relief tempts savers
Venture capital trusts are the vehicle of choice for those who’ve maxed out their pensions, says David Prosser.
Don’t get nudged into a second-rate pension fund
Auto-enrolment means many more workers are now paying into a pension – but the default funds are often a poor choice. Take the time to pick your own, says Cris Sholto Heaton.
Sleepwalking pension savers
A default drawdown product could breed more pensions complacency, says David Prosser.
Passing on the perks
Private pensions can be a good way of sheltering assets from inheritance tax. David Prosser explains.
Good news for defined-benefits pensions
A rate rise or two could make the defined-benefits pensions deficit simply disappear, says Merryn Somerset Webb. In the meantime, there are a couple of things pension fund managers could do to help things along.
Small businesses are shouldering a new pensions burden
Small firms must soon pay more into their workers’ pension funds, says David Prosser.