Pension schemes – how do you choose?
Selecting the right pension schemes is often one of the most important financial decisions you’ll ever make. Getting the right pension will have long-reaching repercussions – if you want to enjoy a financially secure retirement, you need to make the best choices possible and get your pensions in place at as early an age as you can.
For people who are employed by a large company, it’s often the case that they can bypass the usual pension advice and simply opt in to the company’s occupational pension scheme. However, for the self employed, those who are currently out of work, or individuals who wish to double up their future income, it’s important to understand the different pension schemes available and their potential benefits and pitfalls.
Selecting pensions – advice and fund options
There are many different resources available when exploring the often complicated world of pensions. Advice can be found on the Internet, via promotional leaflets and brochures collected from your local bank or building society, from a pension provider or, of course, through financial planners. If you choose to approach a financial adviser for pensions advice, you must ensure that they’re registered with an appropriate regulatory body first, such as the FSA in the UK.
If you’ve decided to invest in a personal pension scheme, you will generally have some level of choice when it comes to exactly where your pension contributions are invested. There are four main types of funds, and your choice will often depend on the level of risk that you’re prepared to take. The main types of investment are cash, bonds, property and equities (shares in private companies); some pension schemes will allow you to invest in a mixture of these asset classes.
If you’re fairly risk averse, you should avoid more volatile types of investments where share prices may be prone to go down as well as up – an example of this would be investing directly into the shares of one company, because prices can change quite dramatically over time and not always in a positive direction. It’s worth bearing in mind, however, that the less volatile the investment, the lower returns they tend to produce.
It’s often the case that those who have taken their pensions advice early can afford to take more risks as they have a longer period in which to generate their pension funds, and those who have opted into a personal pension later in life generally want to keep their risk at a minimum, so that they have a clearer idea of exactly what they’ll get when they retire.
Our financial planners are here to help
Guardian Wealth Management are authorised by recognised regulatory bodies in each of the jurisdictions in which we offer our services.. This means that you can approach us for retirement advice with confidence, with the assurance that we will always act in your best interests.
Because we’re not affiliated with any particular provider, we always offer advice on pension/retirement planning schemes from across a range of providers – ensuring that you have the most flexible and appropriate options presented to you.
Feel free to drop us a line via our contact page if you would like to talk to one of our financial planners regarding retirement planning schemes.