What You Require To Know About Stakeholder Pensions
byon 07-16-2012 at 10:06 PM (190 Views)
"So 1st of all what is a stakeholder pension? Well it is not a new sort of pension so to speak, but it is a private pension which has a set of conditions beneath which it should operate in order to be calle...
For those of you who are thinking about planning for your retirement, you will need to have to do a bit of research on pensions to discover the best way to save for your future retirement. This article is about stakeholder pensions and will explain a bit about them and how they perform.
So 1st of all what is a stakeholder pension? Well it is not a new kind of pension so to speak, but it is a personal pension which has a set of conditions beneath which it ought to operate in order to be referred to as a stakeholder pension. It is not limited to being a private pension as it can also be a set of circumstances which applies to a cash purchase occupational scheme.
The purpose of the set of circumstances is to make the pension simple, easy and good value for cash. So what are the set of conditions that apply to stakeholder pensions then? Well here are the minimal standards that apply to it:
1. The charges must be low at around 1% of the fund invested every year.
2. It must be developed to be basic which is completed by having a standard investment selection so that you do not have to pick the investments oneself.
3. It need to be portable, which means that you can transfer the stakeholder pension on to a various pension which can be another stakeholder pension or one more personal pension. Also if you do this you would not be penalised for transferring it.
4. The pension provider must maintain you informed of any modifications in the charges you have to pay for it by letting you know one particular month ahead of the changes take place. They must also send you a statement at least when a year so you are kept up to date with your account.
5. The minimum contribution must be 20 and you must not be obliged to spend in every single month unless you wish to do so.
So what are the strengths of a stakeholder pension? The principal advantages are that it has low charges, that it has tax benefits, that they are simple to recognize and comparatively simple, are typically speaking good worth for cash and that you can transfer it to yet another pension without incurring any charges.
Are there any disadvantages to it? Well the main disadvantages are that the pension quantity you will obtain in the future is not predictable, that there is an investment risk and that there is no guarantee that your stakeholder pension will keep pace with price inflation. <a href=http://www.roofingsuppliesuk.co.uk/milled-lead/>heres the site[/url]"