Overcoming your pension excuses! For The majority of individuals retirement planning is something that is put on the long finger. As an adviser you hear every excuse imaginable in relation as to why an individual doesn’t need to plan for retirement. Typically if you are not already planning for retirement you will fall into one of the below excuse categories; 1. Im too old to start a Pension Are you too old to save on tax? Did you know that you can save tax on up to 40% of your earnings 2. I’ve heard the fund performance of pensions can be volatile. I would rather save money in the bank! A pension is a long-term investment. Like any investment you must weigh up risk versus growth and determine a portfolio that reflects your goals and risk profile. In addition to this contributions to your pension plan are subject to tax relief of up to 40% and any growth earned by your pension investment is currently tax free. As a top rate taxpayer you are effectively getting a 40% headstart on your investment while reducing your tax bill. Lets not be fooled by holding money in deposit, yes there are periods in the economic cycle when it pays to hold money on deposit but today isnt one of them. With deposit rates at all time lows the purchasing power of your is showing a negative return and it looks set to continue that way for a while longer. 3. My business is my Pension What if you decide you don’t want to sell you business, or you may wish to pass it on to your family? It’s a good thing to spread your investments and make the most of tax reliefs available to you. While they still exist! 4. My Property is my Pension Property is a sensible part of any investment portfolio but can it decrease your tax bill? As we are all aware property valuations are subject to a relative high degree of volatility. It is important that your portfolio is diversified and not solely reliant on the value of a single asset class. A pension plan ensures that this is not the case. Let us not forget the harsh reality experienced by many property developers who were forced to sell in a falling property market. 5. I’m too young to think about Retirement Planning We are living longer and healthier lifestyles. The state pension age is increasing and the amount paid decreasing. So the younger you start a pension, the cheaper it is to provide for your future.