What types of pensions are out there?
There are two main types of pensions: defined contribution and defined benefit. Defined contribution is provided by an employer or individual and has no guaranteed benefits. Defined benefit is provided by an employer that guarantees a part of the pension to be paid upon retirement. There are other types of pensions, but these tend to be more specialised.
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What do I want from my pension?
This is dependent on you and your needs and is probably worked out best through back office systems for IFAs to give you a complete understanding. Having a target to aim for helps in searching for the right scheme. Also take into account that that if you have been working and paying National Insurance, then you will be entitled to a State Pension, so this might have some bearing on which scheme you pick.
What happens to my pension should anything happen to me?
You can ensure that your pension is passed on to your beneficiaries free of tax by informing your pension provider of where the funds should go after death. You can ask your provider for an expression of wish form.
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How can I set up a pension?
If you are employed, then your employer should provide a workplace scheme to automatically enrol you in. The contributions will vary depending on the employer, although the minimum is 3%. If you are self-employed, you have to set up a pension yourself, but assistance can be found through back office systems for IFAs who can help you with this.
What is the annual allowance?
The maximum allowance per tax year is £40,000. However, you will need to take into account your earned income to calculate how much of this allowance you can use. To get more help with this, searching for back office systems for IFAs provided by Intelliflo can get you started.
How much should I be putting away?
This very much depends on how much you wish to receive when you retire. For the defined benefit scheme, you may not need to pay anything additional if what your employer provides is sufficient. If you have a defined contribution scheme, it is possible that the contributions may not be enough for you. Remember that every little helps if you wish to top up the contributions.