There are many important choices you make in life, but few are as important as the decisions you make with regards to retirement planning and the lifestyle you want to lead once you finish working.
Some people choose to make investments in stocks and shares whilst others invest shrewdly in the property market. The most common form of retirement planning and saving for many people is to make regular contributions to a pension scheme.
Following recent research into some of these pension schemes on offer, it has been revealed that the UK’s retirement savers could be missing out on an extra £742 million in tax relief by not making additional contributions to their pension schemes.
The research highlighted that employees who contributed to company pension schemes would be the most likely to miss out by neglecting to save in a tax efficient manner. Taxpayers who are part of their employers’ occupational pension scheme will miss out on an extra £742 million in tax relief through their failure to make Additional Voluntary Contributions (AVCs).
AVCs run in conjunction with pension schemes and allow employees to pay extra into their pension pot, allowing for a larger payout on retirement. This is considered a tax efficient method of saving as AVCs also benefit from the same tax reliefs as main pension plans.
Financial planners have expressed their concern that failing to plan and ultimately save for retirement has become an increasing problem for the UK population. They have also stated that this situation has not been helped by the financial chaos of the past two years in which the value of peoples savings have dropped and so others have been put off retirement planning as day to day financial worries have taken priority.
If you are seeking advice on retirement planning, or simply require investment advice in general, feel free to contact one of our financial experts on 0114 272 3994.