RETIREMENT PLANNING
You may think that your retirement is such a long time away that, planning for an income when you are 55, 60 or 65 years, is one of the last things on your mind when you are busy living and paying for your lifestyle today. Perhaps you are one of the many who used to think that retirement was something in the future, which would never happen to you, and now realise that it is approaching very quickly. However you view retirement, one of the most important factors is to make sure that you have sufficient money to continue with your current lifestyle.

At Morgan Cameron ILP Ltd. we believe that it is important for everyone, whether single or married, to have sufficient funding for retirement in your own right.

For married women, especially, it is not enough to simply believe that you will be provided for by your husband’s pension when you reach retirement age and beyond. You need to know exactly what your position would be if your husband were to die, or if you were to become divorced or separated. You may have a company pension plan, and realise that it won’t provide enough money at retirement therefore need help to find ways to make additional savings. If you are self-employed, or your employer doesn’t provide a pension, you may need help in starting your pension savings.

There are many different ways of saving for your retirement and we help you to decide which is right for you. But first let us give you a brief summary of the different arrangements available and how they can be used for your benefit:

Occupational Pension:
These are pensions provided by your employer where they may make a payment into your pension as a percentage of your salary or a flat amount which it may or may not be compulsory for you to make your own contribution. The pension which you receive at retirement will either be a guaranteed amount, depending on your earnings and years of service, or will depend on the amount of money saved, the growth in the pension fund and the annuity which is bought in your name.

If you have a pension provided by your employer and don’t know what type of arrangement is in place, then contact us. We will explain the terms and help you to understand your pension plan.

Additional Voluntary Contributions (AVCs):
:AVCs are a way of making extra payments into your occupational pension and help you to increase the amount of pension which you have at retirement. The extra pension which you receive depends on how much you save, the fund performance and your annuity rate at retirement.

Added Years:
One other way of saving is by buying what is called "added years". This type of arrangement is only available if your occupational pension provides an income at retirement based on your years of service and is called a "final salary" pension. You may be able to buy extra years which will mean that your pension at retirement will be based on more years than those from which you actually started the pension payments. You can pay monthly, or with a lump sum, and this will increase your guaranteed pension at retirement.

Free Standing Additional Voluntary Contributions (FSAVCs):
These are similar to AVCS described above, except that you can choose from a variety of different FSAVC pension companies and don’t have to use the insurer suggested by your employer. Also, if you change jobs then your FSAVC can be transferred to your new employers pension scheme. Your AVC would remain with your current plan if you changed employment.

The charges made for setting up the FSAVC are usually higher than those for occupational AVCs.

Personal Pensions:
These are provided by a number of different insurance companies and the amount of pension which you will receive will depend on how much you save either monthly or with lump sums. Also how long you leave your money in the pension to give the fund time to grow and how well the fund performs over the years.

When you reach retirement you then use your pension fund to buy an annuity. (These are described on our annuities page if you want to know more.) We help you to choose the pension company which gives you the lowest charges, combined with good fund performance and flexibility, offering the best terms for you.

State Second Pension:
This is a pension provided by the government in addition to the basic State pension and is based on the amount of National Insurance Contributions, which you have paid, and your age.

It is possible to "contract out" (leave) the State Second Pensions arrangement and for your National Insurance payments to be paid into your own pension plan. This may be to your advantage, according to your age and earnings and we will explain what is best for you and provide you with a personal quotation.

Stakeholders Pensions:
The intention is that these pensions are more flexible than personal pensions and usually have lower charges. You can arrange a Stakeholders Pension either through your employer, or personally, with one of the insurers who offer these arrangements.

Planning for your retirement and making sure that you have the plan which is best for you is important. Contact Morgan Cameron ILP Ltd. to discuss the arrangement which suits your needs.