Please note: The value of pensions and the income they produce can fall as well as rise. You may get back less than you invested.
Make plans for your future, so you can enjoy your retirement.
Sterling specialises in providing long term pension advice. We have a ‘down to earth’ approach to our customers retirement plans - we offer honest advice, helping you to secure your future with a pension plan that meets your requirements
There are 4 core categories of pensions:
1. Personal pensions were originally only available to those who were not members of occupational schemes. They were set up to provide tax incentivised savings as an alternative to membership of occupational schemes.
A certain amount of money is paid into the pension every month, and the funds are invested in stocks, shares and other investments on behalf of the individual.
The pension provider can claim tax relief at the basic rate, though higher-rate taxpayers can claim additional tax relief on contributions through their tax returns.
2. Self-Invested Personal Pensions (including Hybrid SIPPs) Self-invested personal pensions (SIPPs) provide a flexible option, allowing the individual to determine where and how the pension pot is invested.
As per the Personal pension, SIPPs qualify for tax relief, although set-up fees, annual charges, fund fees and exit fees need to be taken into account by the individual.
3. Occupational Pension Schemes Occupational pension schemes are organised by employers for their staff, and can be either a trust run by trustees or it can be administered by a life insurance company.
Occupational pension schemes are either ‘contributory’, where a percentage of the employee’s salary is paid each month, or non-contributory, where an employer makes payments on the individual’s behalf.
A Money Purchase or Defined Contribution scheme is where the employee builds up a pot of money within a scheme - the pension is determined by the employee’s wages, and is based upon how much is paid in, how long it has been invested, any charges incurred, and the return on investments.
Final salary schemes represent the 'gold standard' of occupational pension schemes - employees are guaranteed a pension prior to retirement, based on a final salary and the number of years of pension contributions.
4. Workplace Pensions Auto-enrolment is a government-led pension scheme, where both the employer and employee are required to contribute to the pension pot. Employers are legally obliged to enrol their employees into a pension scheme.
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