Pension question ‘not enough people are asking’ – simple way to boost retirement pot
Moneybox advises on saving money for retirement
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Investment expert Robin Powell states “not enough people are asking” their employers to put more into their pensions, and this is a simple way to boost pots. On the Informed Choice Radio Podcast, Mr Powell discussed the benefits of people sticking up for themselves to push boundaries and potentially receive more.
He said: “One thing I mention is the importance of sticking up for yourself.
“Going to the boss and saying I deserve more than what I’m being paid because if you’re not going to stick up for yourself no one else will.
“The other thing you can also ask your employer is ‘can you put more into my pension’.
“Not enough people are asking this question.
“It’s certainly worth asking.”
Martin Bamford, presenter of the podcast highlighted the value of bonus sacrifice as a way to further boost pension pots.
Bonus sacrifice is when a person pays their bonus from work into their pension instead of having it paid into their bank account.
He said: “When bonus time comes around each year, the employee’s here who are thinking about the future always ask us to make that bonus sacrifice and put that money into the pension and we can see that future vision with them.”
By doing this, people can save a significant amount of tax and build wealth for their future.
It’s important that Britons are invested into things that will work as hard as possible for them.
This is why people should know exactly what their workplace scheme is offering and if this can be maximised.
Mr Powell suggested people should ask questions such as ‘do you match my contributions?’ instead of just offering the minimum three percent rate.
Some companies may say ‘If you pay eight percent, we will also pay in eight percent,’ so there may be an opportunity of getting more money.
Most people in employment should have access to a workplace pension and should be already automatically enrolled.
The government introduced auto enrolment in 2012 to help more people save for their retirement so people begin paying into their pensions as soon as they receive the required salary.
The minimum total contributions under automatic enrolment have been set by the government to eight percent for most people.
Employers must contribute a minimum amount; in most cases this is three percent.
The government help people to save for their pension by giving tax relief on their contributions also.
So, people contribute four percent into their pensions whilst their employers contribute three percent, and the government add one percent tax relief totalling eight percent minimum.
Eight percent is the minimum so Britons should ask their employers it is possible at all to increase their contributions to really maximise their pots for the future.
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