PENSION PLANNING WITH
JOHNSTON FINANCIAL

Knowing you will have enough money to live the life you want to lead both now and in the future, is essentially what financial planning is all about.  Saving for your retirement is a priority.  If you are fortunate enough to be in a Defined Benefit pension scheme throughout your career, this is largely taken care of.  In any other circumstance, you only know if your pension saving is enough by valuing your existing pension arrangements, estimating what they will give you on retirement and deciding what you should contribute now and in the future.

If you would like to speak to Johnston Financial about your pension arrangements, please contact us by phone or use our Enquiry Form and we will respond directly to you.

Whilst the concept of pensions as a way of saving is a simple one, over the years, different types of pension arrangements have been created, often to respond to changes in legislation.

The expertise of Johnston Financial is available to you to guide you through the different types of pensions available and how to choose what is right for you.

If you would like to speak to Johnston Financial about a pension plan, please contact us by phone or use our Enquiry Form and we will respond directly to you.

Reviewing existing pensions is one area where both Government legislation and the rules of The Financial Conduct Authority make it difficult for you to act on your own behalf. In some circumstances, it is not possible for you as the owner of a pension plan to make a “pension transfer” without taking advice from an adviser with the required qualification.

The advisers at Johnston Financial have the necessary pension transfer qualification and are able to advise in this complex area.

Transfers from one personal pension plan or group personal pension plan to another are not normally so restricted, but transfers from an occupational pension scheme are. It may be that the first you know about this is when you approach your pension scheme or insurance company and they tell you that they will only do what you ask if an adviser certifies that they have given you advice and accept responsibility for the transfer.

If you would like to speak to Johnston Financial about reviewing your existing plans to ensure they continue to be suitable, please contact us by phone or use our Enquiry Form and we will respond directly to you.

In 2015, new pension freedoms were introduced. This removed the requirement to buy an annuity with your pension pot and allow you, once you are 55 or over, to access it in any amount or frequency you choose.  One quarter can be taken as a lump sum and the rest is taxed as income as it is withdrawn. There is also freedom on your death, to pass on your pension pot to your spouse, partner or children. This can be a useful part of your Inheritance Tax planning as, in most circumstances, there is no Inheritance Tax on pension pots passed down the generations.

These pension freedoms give you excellent financial planning opportunities but as ever carry some pitfalls, especially around tax. Johnston Financial can explain the freedoms and opportunities and help you to steer clear of the pitfalls.

If you would like to speak to Johnston Financial about new pensions freedom detail, please contact us by phone or use our Enquiry Form and we will respond directly to you.

The new Pension Freedoms have made it easier to draw your pensions in a way that specifically meets your needs. This means, of course, that there are now so many permutations of how and when you take:

• your tax free cash sum
• taxable one off payments
• regular income

While this may seem complex, it really is an excellent opportunity to draw down from your pension pot in a way that meets your own plans for your retirement and is tax efficient. For instance, whilst you can take your tax free lump sum as a single payment, it can also be used as part of your regular income so that one quarter of each income payment is tax free.

If you would like to speak to Johnston Financial about drawing money from your pension pot, we will consider all your options and provide you with the right advice for your circumstances. Please contact us by phone or use our Enquiry Form and we will respond directly to you.

Whilst pension freedoms have transformed how you draw money from your pension pot, the Government has been keen to limit the amount of money that can be accumulated in pensions and benefit from the generous tax allowances. They have done this by creating two allowances.

The annual allowance is a limit on the amount that can be contributed to your pension each year, while still receiving tax relief. It’s based on your earnings for the year and is capped at £40,000.

The Lifetime Allowance is a limit on the amount of pension benefit that can be drawn from pension schemes – whether lump sums or retirement income – and can be paid without triggering an extra tax charge.  The test for the lifetime allowance is done each time you access a pension benefit.

If you would like to speak to Johnston Financial about how the Annual Allowance and Lifetime Allowance affect you, please contact us by phone or use our Enquiry Form and we will respond directly to you.

The State Pension is an important building block of your pension income in retirement and with the introduction of the New State Pension in 2016, it is a very good idea to obtain a State Pension forecast.  This is very easy to do online here

If you would like our help to do this, please contact us by phone or use our Enquiry Form and we will respond directly to you.

The Pension Advisory Service provide useful information on the State Pension and it can be found here.