The earlier you start thinking about your retirement needs the better, writes Financial Times. If the government and financial institutions have anything to do with it, future generations will study financial planning at school and be saving diligently for their retirement by the time they reach the ripe old age of 18, according to the newspaper.For now, though, it takes a 40th birthday for most people to focus on pensions - by which time, there is no room for mistakes. So, how do you get your pension choice right first time around?
Employees who have spent most of their careers in good company schemes should not have too much to worry about, although they should check to see if any job changes or career breaks have left gaps in their pension provision. If they discover contributions might not meet their retirement needs, they should consider topping up their fund through tax-efficient investments such as their employer's additional voluntary contribution (AVC) scheme.
The self-employed andemployees not in company schemes are likely to need a personal pension. Pensions advice forms one of the core elements of financial planning and, depending on the complexity of an individual's affairs, may require a high level of expertise. In theory at least, most independent financial advisers should be able to select the right personal pension for your circumstances.
They should base their selection on:
The performance of the pensions company: this should be consistently good over the long term. Stability of the investment management team. The long-term viability of the company and the level of its commitment to the pensions market. The level of charges deducted throughout the investment period.
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