There is every possible indicator why people should start thinking about their pension in 2020. According to experts, the State Pension is set to rise from the month of April in 2020. This means that millions of pensioners will be better off making approximately £350 annually. This is seen as a result of the government’s triple lock system that is set to give the State Pension in the UK a 3.99% boost, the biggest boost since they year 2012.
New entrants in the new State Pension have the chance of looking forward to approximately £175 in weekly allowance and approximately £134 for those pensioners on the Basic State Pension.
The Triple Lock System Influence
The system was a brainchild of the 2011 coalition government with its core purpose being to ensure that there is always a steady rise in the Basic State Pension by a minimum of 2.5% every year or average on the growth earnings or the rate of inflation, all depending on whichever is greater. They form the core benchmarks of the triple lock system. It will see to it that retirees avoid finding themselves in the pension poverty trap.
Pension planning for 2020
Planning for pension is a reality that one cannot avoid for anyone under 65. The official retirement age in the UK is set to rise and it calls for a lot more people to start thinking of pensions in 2020. Thinking about the future involves having a Self-Invested Personal Pension (SIPP), a facility that will help you save and plan for your retirement on your terms.The scheme gives its users a lot more freedom and flexibility in their investments.
A SIPP is a sure-fire way of getting a tax relief for UK residents under the age of 75. Currently, pensioners are liable to getting up to 45% tax breaks when making investments to SIPP. The 20% basic tax relief is payable by the Her Majesty’s Revenue and Customs (HMRC).
For residents overseas planning to retire, a Qualifying Recognised Overseas Pension Scheme (QROP) will ensure that they receive a considerable tax and financial benefits while transferring their pensions to the host country through a QROP. Forecasts suggest that such moves are going to be a lot more flexible over income payments.
That is not all, there is more room for residents to take advantage of Small Self-Administered Scheme (SSAS) in the UK. The future of SSAS seems bright and one to jump on. Investing in SSAS gives investors opportunities generally not available to other types of pensioners. Such opportunities include purchasing company shares and lending money to the company.
The future of mis-sold pensions and SIPP claims
There has been a strict notice to ban any financial adviser that takes part in mi-selling pensions by giving unsuspecting investors unsuitable advice just to make money from them. Such actions by the Financial Conduct Authority (FCA) will see the reduction of mis-sold pensions in the future, giving pensioners a chance to go after their SIPP claims.
There have been stricter guidelines surrounding cases of mis-sold pensions. It is prudent for investors to get claims advice in case they feel they have mi-sold pension. Any case of mis-sold pension always points to a certain pension introducer. A pension introducer is always at the centre of any mis-sold pension scandal. Whether or not you have made a final salary pension transfer, you can make a claim. Final salary pension transfer is a risky endeavour that requires you to get claims advice before engaging in it. Furthermore, people always get committed into defined benefit pension without getting enough advice and finding themselves digging deep into their pockets to cover these schemes. You need enough guidance before you get yourself into any defined benefit pension scheme.
Mis-sold annuity and annuity claims
Even as you are thinking of investing in a pension scheme, always watch out for any signs that might cause you to believe that you may have a mis-sold annuity in your hands. Some signs include the fact that no one is interested about your health status, you aren’t provided with any other options or you are not told of any hidden charges.