Brighter days are ahead

This year has brought hope of a better financial future as inflationary pressures recede and as the economy continues to grow. Therefore, it could be an ideal opportunity to prioritise a range of pension-related issues in order to ensure brighter days do lie ahead.

Pension withdrawals up

Many people have faced significant financial challenges over the last few years. Recently released data from the Financial Conduct Authority (FCA) covers these difficulties during 2022/2023, with the number of pension plans being accessed, increasing by 5%. However, as recent challenges start to ease, it is hoped that rather than dipping into your pension savings, people’s focus will return to boosting their retirement pots and sorting out other pension-related concerns.

Expression of wishes

One issue relates to inheritance, with research from Canada Life showing that almost half of all UK pension savers have not considered who will inherit or benefit from their retirement provisions upon their death. Since the changes to the Lifetime Allowance in April, decisions around pension beneficiaries have become more vital due to the way pensions are taxed on receipt. Therefore, it is worrying that the same research found more than half of the respondents had not completed an expression of wish form, with a further one in ten unaware if their forms were up to date.

Tax Issues

Most people appreciate the tax advantages that are associated with contributing to a pension, but what is often less well known, is their potential to pass on wealth tax-efficiently. Pensions play an important role in supporting loved ones after you pass away. As pension contributions reduce your taxable income, they can also be used to your advantage to navigate the trap of Child Benefit, meaning that you can continue to receive the benefit rather than pay the Child Benefit Charge.

Conversations regarding pensions

We appreciate the importance of devoting time to pension arrangements now to ensure that you reap the benefits later.  If you need help with any of your retirement related issues, we can talk through your options and make sure you are maximising your pension benefits in the most efficient way.