Stakeholder pension

What is a Stakeholder pension?
A stakeholder pension plan is a savings plan for anyone under age 75. They let you save for retirement in a tax-efficient and cost-effective way.

Stakeholder pensions have all the key tax advantages of other personal pensions including:

• Tax relief on your contributions
• Tax efficient growth in your pension fund
• The ability to take part of your pension benefit as tax free cash

Key points about Stakeholder pensions

• Low minimum contribution- you can start saving from just £20 a month
• Low charges- charges for stakeholder pensions are generally lower than they are for other types of pension plan
• Contribution flexibility- you can stop payments and start again whenever you like. You can change the amount that you pay into your pension every month.
• Investment choice- stakeholder pensions usually have a fairly limited investment choice

Who is it for?
A Stakeholder pension could be suitable for you if:

• You are employed, self employed or even if you don't work
• You don't plan to save a lot every month
• You're not looking for a wide range of investment opportunities
• You want a low cost pension plan

Need help deciding?
A chat with one of our financial planning advisers is without obligation. Call us to make an appointment. 0845 301 9945

• How it works

There is no minimum age for a Stakeholder pension. So long as you are under age 75, you can use one to save for your retirement.

Starting your plan

• You decide how much to save- the minimum you can save is £20 each month. If you want, you can save up to 100% of your earnings in a Stakeholder pension - subject to a maximum of £245,000 (2009/10). If you have no earnings, the maximum savings you can get tax relief on is £3,600 each year.
• You decide how your money is invested- Stakeholder pensions usually offer a range of investment funds limited to ‘managed' or ‘tracker' style funds.

Building your fund
The contributions you save benefit from any growth in the investment fund you have chosen. Your contributions grow in a tax efficient fund.

When you retire
You can take your pension benefits whenever you want between age 50 (55 from April 2010) and 75. You can choose how your benefits are paid:

• Tax free lump sum- up to 25% of your pension fund can be taken this way
• Pension- you could opt for a level pension, one that increases every year or one that continues to be paid to your spouse or civil partner if you die. Your pension benefits will be taxed as income.

Ready to start saving?
Have a chat with one of our financial planning advisers for a no obligation review of your retirement plans. Call us to make an appointment. 0845 301 9945

• Benefits of Stakeholder pensions

A stakeholder pension is one of the most straightforward, tax efficient ways to save for your retirement.

Tax benefits

• Tax relief on the contributions you make, the amount of tax relief depends on how much you earn
• Contributions grow in a tax efficient fund
• Take up to 25% of your accumulated pension fund as a tax free lump sum

Price benefits

• Start a stakeholder pension from as little as £20 a month
• Charges on stakeholder pensions are generally lower than they are on other personal pensions

Other benefits

• Change, stop and restart your contributions whenever you want
• Even if you don't have any earnings, you can still save up to £3,600 a year with a stakeholder pension
• If you have another pension plan or have been a member of a company pension scheme, you can normally transfer these pension funds to your stakeholder pension
• If you want, you can transfer your stakeholder pension fund to another pension scheme anytime before you retire

Ready to start saving?
Have a chat with one of our financial planning advisers for a no obligation review of your retirement plans. Call us to make an appointment. 0845 301 9945

• Benefits of Stakeholder pensions

Can someone else pay into a stakeholder pension for me or can I pay for someone else?
Can I transfer another pension into a stakeholder pension plan?
How do I claim higher rate tax relief on my contributions?
How much can I pay into may stakeholder pension?
What happens if I die before I retire?

Can someone else pay into a stakeholder pension for me or can I pay for someone else?
It is possible for someone to pay your Stakeholder pension contributions or for you to pay someone else's contributions. Ask your financial planning adviser about this.

Can I transfer another pension into a stakeholder pension plan?
Many Stakeholder pensions can accept transfers from other plans. Ask your financial adviser about this.

How do I claim higher rate tax relief on my contributions?
You have to claim any higher rate tax relief through your annual self-assessment tax return. Your accountant or tax adviser can help you with this.

How much can I pay into my Stakeholder pension?
There is a maximum amount you can pay into your plan and claim tax relief on. This depends on whether you pay tax or not.

What happens if I die before I retire?
With most modern pension plans, the value of your pension fund will normally be returned to your dependants if you die before you retire.