LOG IN APPLY
LOG IN APPLY

UNDERSTANDING PENSION CONTRIBUTIONS

Contributions - the basics

For a comfortable retirement where you’re financially secure and can enjoy your leisure time, making regular pension contributions is crucial. Your pension pot serves as your financial foundation for the future.

Pension contributions are vital for everyone, regardless of their employment status. Having a well-funded pension becomes even more critical considering the rising costs of living and the uncertainty surrounding state pensions. Even though the state pension is available to most individuals, it often falls short in providing a sufficient income for a comfortable retirement.

To bridge this gap, it’s essential to contribute to a personal pension plan. Personal pension contributions offer tax benefits, with taxpayers receiving extra incentives for their contributions. Maximising you contributions now can lead to significant rewards in the future.

Taking charge of your pension planning and making regular contributions is crucial to ensure you have enough funds to support your desired lifestyle during retirement. To simplify the process and maintain consistency, you may consider using platforms like iSIPP, which offer easy pension management and allow you to set up automated contributions for added convenience.

Learn about consolidating with iSIPP

4 reasons
you should be regularly
contributing to your pension

Tax advantages

Private pension contributions in the UK offer attractive tax benefits. Through tax relief, individuals receive a boost to their pension contributions from the government. Basic rate taxpayers receive a 20% tax relief, while higher and additional rate taxpayers can claim 40% and 45% tax relief, respectively. This into your pension, effectively increasing your savings for retirement.

Financial security

Contributing to a private pension in the UK is essential to secure financial stability during retirement. While the state pension provides a basic level of income, it may not be sufficient to maintain one's desired lifestyle. By actively contributing to a private pension, individuals can build a substantial retirement fund that complements the state pension and ensures a more comfortable and worry-free retirement.

Investment potential

By contributing to a private pension early and consistently, individuals can benefit from the power of compound interest and long-term investment growth. Over time, these contributions can accumulate and generate substantial returns. Many private pension schemes offer a range of investment options, allowing individuals to tailor their investments to suit their risk appetite and financial goals.

Flexibility and control

Private pensions offer greater flexibility and control over your retirement savings compared to the state pension. Individuals can choose from various pension providers and plans, enabling them to select the one that best aligns with their needs and preferences. Additionally, some private pensions offer options for early retirement, flexible withdrawals, and the ability to pass on pension wealth to beneficiaries, providing greater control over one's financial future.

Start contributing early

Compound interest grows your pension most when started early. Even small, consistent contributions can add up over time.

Delay retirement

Working longer allows your pension to grow more before drawing on it. Delaying drawing pension benefits can also increases their value.

Use the drawdown method

Withdraw lump sums as needed while keeping the rest invested. This could allow continued growth.

Consolidate pensions

Combining multiple pensions could cut fees and simplify investing. Potentially maximising growth.

Simple pension management trusted
by our growing partner community

Take control of your
pensions with iSIPP

Join our growing community of people taking control of their pensions. Consolidate old pension pots, make regular or ad-hoc contributions, and choose your own investments with iSIPP.

GET STARTED

0161 972 2841

iSIPP, 2nd Floor, Marshall House

2 Park Avenue, Sale, United Kingdom, M33 6HE

hello@isipp.co.uk

iSIPP is a trading name of iPensions Group Limited registered in England and Wales with Company Number 03683070 whose office is at 2nd Floor, Marshall House, 2 Park Avenue, Sale, M33 6HE. Authorised and regulated by the Financial Conduct Authority, Licence Number 464521.

©️ 2023 iSIPP. All Rights Reserved.

X

Subscribe to our newsletter