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5 Reasons to Consolidation your private pensions

Five reasons why consolidating your private pensions could be useful

The days of spending your whole career working for one company – and paying into a single pension pot – are over. Auto-enrolment laws mean that many people have a number of smaller workplace pension funds and some larger companies offer defined benefit pensions too. As well as making retirement planning harder, this potentially loses you money. Pension Consolidation might not just make things easier but could be profitable, whether you choose income drawdown or an annuity.

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Understanding the risks of pension income drawdown

Drawdown – Understanding The Risks, Advice Is Essential

We’re sure you’ve heard the term pension drawdown; this is where you leave your pension fund invested and take income as and when you need it, instead of using the cash to buy an annuity as people did traditionally. As the money remains invested, the pension fund can continue to grow, even when you’ve retired.

Since pension reforms, introduced in 2015, more retirees have opted to take this more flexible option with their pensions, and the Financial Conduct Authority has reported that drawdown has become much more popular, with twice as many people moving their funds into drawdown rather than an annuity.

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Inheritance tax - time for an overhaul?

Inheritance Tax – Time For An Overhaul?

If ever there is a UK tax that needed a major overhaul, then Inheritance Tax (IHT) must be a top candidate. Many families will be delighted to hear that the Chancellor, Philip Hammond, has written to the Office of Tax Simplification (OTS) asking them to reform IHT “to ensure that the system is fit for purpose and makes the experience as smooth as possible”

Mr Philip Hammond in his letter asked the OTS to look at the technical and administrative issues with Inheritance Tax, the process of submitting returns and paying the tax. Mr Hammond also called for a review of the problems surrounding estate planning, and whether the current framework causes ‘distortions’ to taxpayers’ decisions regarding investments and transfers.

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More women are working into their 70s

More Women Are Working Into Their 70s

In yet another sign that retirement is becoming an increasingly fluid concept, figures from the Office for National Statistics show that the number of women working past the age of 70 has doubled in the last four years.

The abolition of the compulsory retirement age in 2011 has meant that many more workers, men and women, are choosing to work on past their normal retirement date. For some, it’s the desire to keep physically and mentally active into their later years, for others the freedom to work for longer provides a welcome boost to their retirement income. With increased life expectancy, many more people are set to live active lives well into their eighties.

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Retirement planning - Investing Income for retirement

Investing for Income in Retirement

Today, savers reaching retirement have more choices than ever before about how they use their pension pots to fund their retirement.

Instead of simply using their pension money to buy an annuity that provides a guaranteed income for life, many choose to invest throughout their retirement years. The challenge this brings is to deliver a continuing income, while ensuring they don’t run out of funds later in life.

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Millions of people are relying on just £7k in retirement

Millions Relying On Just £7k In Retirement

According to research carried out for the Pensions Policy Institute, many pensioners are relying on their state pension for three-quarters of their income. It can come as a shock to many that their state pension entitlement increased to £164.35 per week from April 2018, but only for those who have a complete record of National Insurance contributions, meaning that some people will receive less. On top of that, the government announced last July that the state pension age would be increased to 68 between 2037 and 2039.

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One in three brits at risk of falling for pension scams

Nearly one-third of Britons at risk of falling for pension scams

Millions of Britons are unable to spot even the most obvious pension scams, according to new research that calls for stronger checks to help people avoid them. The study from the Pensions and Lifetime Savings Association (PLSA) found that 29% of the 2,000 people surveyed, equating to 14.8 million UK adults, were unable to spot even the most obvious scams.

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Older workers facing the pressure of inter-generational needs

Older workers facing the pressure of intergenerational needs

It’s estimated that around 1.9 million workers aged over 50 find themselves juggling the competing needs of the younger and older generations, sometimes overlooking their own financial planning requirements. As a result, many feel under pressure to go on working for longer; others sacrifice saving for their retirement to help other family members.

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Taking 25% out of your pension may seem attractive

Taking 25% out of your pension pot may seem attractive

Since Pension Freedoms were introduced in April 2015, people are now able to access their pension funds more flexibly and can take up to 25% of their pension as a tax-free lump sum, at age 55 or above. Pension drawdown, also known as income drawdown allows you to access a quarter of your private pension funds, without paying any tax, and also enables you to keep the remaining balance of the pension funds invested, ensuring it still has the potential to grow – unlike if you were to purchase an annuity.

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