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Pensions. Sensible option or waste of time?

For years my parents have always encouraged myself and my siblings to take out pensions, which I did when I worked for big corporate companies, in fact I have two. Now I don’t work for my previous employers, those pensions will sit for another 35 years until I can actually touch them. I could carry on paying into the private pensions, but like so many others, I am confused by what we should do when it comes to taking out a pension, especially in the current climate, our generation having to work longer, and whispers of “there will be not state pension when you retire”. What do we do? What are our options?

On January 13th 2011 the government proposed its new Pension Bill which would include some changes. Firstly the age in which you receive your state pension has changed.

The ages in which women will receive the state pension is moving from 60 to 65 and eventually after 2024 will rise to 66. This will then put the women in line with the men and both will receive the state pension at 66.

At the beginning of 2012 all companies must offer their employees a pension, this will apply to every firm no matter how many staff they employ.  Those companies that don’t have a company pension scheme can enroll their staff on the National Employment Savings Trust (NEST) .Contributions from this scheme will start at 2% of a salary, of which 1% if paid by the company, it will then rise to 5% by 2017 of which 2% will be matched. This system has been under fire, but does allow thousands of people to save for a pension who have never had the choice before. If the thought of a pension fills you with dread, there are other options such as savings accounts, or putting your money in property.

Unfortunately money issues change from day to do, so its all about being a savvy shrewd person with your finances.

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