A personal pension plan is a tax efficient savings plan designed to provide a regular income on retirement.

Your contributions will be invested in one or any number of funds with the company recommended. In time the value of your fund should increase until you are ready to receive your benefits, at which point you will use the accumulated fund to generate an income.

One of the great tax advantages that Personal Pension Plans have over other types of investment is the considerable tax concessions that your contributions and investment funds receive.

Firstly, your contributions receive tax relief based on the highest rate of tax you pay. Secondly, where the money is invested, it grows free of Capital Gains Tax. No other UK investments offer these advantages.

You can also protect your contributions against inflation, by having them increase year on year, or build in an option called waiver of premium, where the Insurance Company will waive your contributions if you are unable to work due to ill health.

According to a study carried out in 2001 by the Association of Consulting Actuaries, workers starting a pension at age 25 need to invest a minimum of 10% of their income if they want to retire with just under 2/3rds of their final wage to live on. However, those wishing to retire early or are starting later need to invest much more.

The ACA recommends that those starting a pension at the age of 35 need to invest between 15% to 20% of their salary while those starting at age 45 need to ensure that up to 30% is invested.

To speak to one of our fully qualified independent financial advisers now either phone 0871 433 3700 or click the contact section on the bottom of this page and someone will speak to you straight away to help you with your pension choices.