Women will now start to qualify for the State Pension at the same age as men, currently set at 65. The move to equalise male and female pension ages began 25 years ago and has been gradually phased in. Your State Pension age is the earliest age you can start receiving your State Pension. It may be different to the age you can get a workplace or personal pension.
Self-employment enables you to exercise your sense of freedom in business decision-making and to choose your own business path. There are many benefits to becoming a self-employed freelancer or running your own business: the flexible hours, the option to work from home, no fixed holiday allowance, and, of course, being your own boss. But it’s vital to remember that there is no sick pay, life insurance or pension scheme benefits, unless you arrange to put these schemes in place yourself.
Selecting the most appropriate investment products and undertaking the right planning at the right time to minimise the amount of tax you pay are key to accumulating wealth over the long term. Add to this general economic factors, business conditions and political events, these are just some of the things that can cause uncertainty and volatility in the markets. Over any given time period, the economy can also go through a series of ups and downs.
Make the most of the early years and maximise from the power of compounding
Retirement might seem a long way off, so it’s easy to understand why saving for retirement isn’t a priority in your 20s – a decade when advancing your career, not planning for the end of it, seems more important. But, youth is a huge advantage when it comes to building wealth for retirement because it gives you time to maximise from the power of compounding.
Pensions can seem complicated, but the basic idea is a simple one. And increasingly, if appropriate, people are turning to private pensions as a tax-effective way to increase their retirement income. Once you’ve decided to start saving for retirement, you need to choose how you’re going to do it. The precise amount you’ll need to save each month to retire at 55 depends entirely on the kind of lifestyle you plan on having in retirement. If appropriate to your particular situation, there are several different types of private pension to choose from. But, in light of recent government changes, the tax aspects require careful planning.
