The simple answer is: as much as you
can afford!
Depending on your age when you begin saving, experts
recommend at least 10% of your salary, increasing as
you get older!
The most important thing is for you to increase your
contributions as your earnings increase, and this is
encouraged by the government in the amount they allow
you to save into pensions.
In the past saving into a pension was dependent on
having earnings on which to base the level of savings
an individual could make. This meant that many including
students, the unemployed, people unable to work through
illness and mothers taking a career break were unable
to contribute into pensions.
Most individuals are now allowed to invest up to £2808
net into a pension each tax year regardless of whether
they are earning or not. That net premium of £2808
is automatically uplifted to £3600 by the addition
of basic rate tax relief (22%) regardless of whether
they pay tax or not.
Money for nothing!
This also provides an opportunity that parents and
grandparents can set up a pension for their children/grandchildren
thereby setting them off on the pension savings ladder.
If you are a member of a company pension scheme you
will normally be expected to contribute a certain percentage
of your salary into the scheme, but it is now possible
to top up your benefits into an additional arrangement
either with your company or into your own plan.
At Harris and Associates Financial Consultants Limited
we can discuss your current requirements, your affordability
and expectations and provide you with recommendations
and illustrations of what you might be able to receive
at retirement.
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