Seven pension myths busted
- It’s not worth having a workplace pension
Not true! Most people receive more back than they contributed. They also receive contributions from their employers and in most cases tax relief.
- My property is my pension
Not everyone wants to sell their home when they retire to live somewhere smaller. Bills still need to be paid.
- I’m too old to start a pension
If it’s a workplace pension, you’ll miss out on “free money” in the form of a contribution from your employer. Secondly, saving into a pension is probably the most tax efficient way to save
- I’m too young to start a pension
Starting early makes a huge difference thanks to the magic of compound interest.
- I can’t afford it
With auto enrolment, if you opt out you’ll be re-enrolled again every three years when hopefully your financial situation will have improved.
- My pension will be lost if I die before retirement
What happens to your pension when you die depends on the type of scheme you have. Many schemes allow the full value to be transferred to a love one / dependent.
- The State Pension will be enough for my retirement
The full amount of new State Pension is currently £168.60 a week – that’s just over £8,750 a year. For most people, this won’t be enough.
