Why start a pension now?
Starting early makes sense
Your money has more time to grow, and you will get more top-ups from the taxman.
If you start a pension early, you can pay in less each month and still match the pension of someone who starts later – or pay in the same which means you'll have more than they will, come retirement.
| Age 25 Retiring in 40 years | Age 35 Retiring in 30 years | Age 45 Retiring in 20 years |
|---|---|---|
| Age 25 Retiring in 40 years | Age 35 Retiring in 30 years | Age 45 Retiring in 20 years |
| ...and you saved £200 a month, this is how much income you'd end up with each year in retirement | ||
| £10,700 | £6,860 | £4,030 |
| The taxman would have given you: | ||
| £24,000 | £18,000 | £12,000 |
| So your pension pot would be worth: | ||
| £190,000 | £120,000 | £70,500 |
These figures are illustrations only to demonstrate potential fund growth, and the pension income you might get when you retire. We've made some assumptions: that the tax position doesn't change; that your payments remain constant; and that you'll retire at 65. We've assumed that your investments will grow at 7% per annum (you may get more or less than that) and that your annual charges will be 1%. Nothing is guaranteed.
