A personal pension (also known as a private pension), works similar to a workplace pension. The difference being, it’s set up by you rather than your employer. There are three main types of personal pension:
All three pension types are defined contribution schemes, which means you contribute into a savings pot which is invested into a fund. This money can then be accessed from the age of 55. The amount that you’ll have access to will depend on how much you’ve contributed, and how your investments perform.
Although the two pension schemes are very similar, there are a few key differences.
A SIPP is a type of pension that lets you take control of your retirement money and investments. It’s the most flexible type of personal pension, as you have the freedom to invest almost anywhere you like, and can often choose from ready-made investment portfolios or pick your own individual investments. SIPPS have the potential for higher levels of growth, but also higher levels of risk.
If you don’t have a workplace pension, then setting up a personal pension could be a good way to start investing and planning for your retirement. This may be a good option for those who are self employed, or those who have opted out of there workplace pension scheme.
You can pay into a personal pension and a workplace pension simultaneously if you wish, however there is a limit on how much you can invest into your pension pot each year (the annual allowance) and throughout your lifetime (the lifetime allowance).
If you’re unsure which type of pension is the best option for you, seek professional advice from a reputable adviser
Make sure that any person or firm you discuss your pensions with are regulated by the Financial Conduct Authority (FCA) and are authorised to provide pension advice. Check the FCA register of regulated companies before giving out any personal details.
Money Advice Office provides free independent and impartial information and guidance. They also have reputable financial advisers available who can help you make the best decision for your own personal circumstances.
You can also request contact details from the Pension Tracing Service by phone or by post.
The Pension Tracing Service
Telephone: 0800 1223 170
From outside the UK: +44 (0) 1782 389134
Monday to Friday, 9:00 am to 5:30 pm
The Pension Tracing Service
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The Pension Tracing Service ® is a trading style of the Millennial Wealth Ltd. We are authorised and regulated by the Financial Conduct Authority. FCA number 914746. Unit 11Flag Business Exchange Peterborough Cambridgeshire PE1 5TX. The registered company number is 11557299
This service is not affiliated with the Department of Work and Pensions or any government body. The Pension Tracing Service does not offer financial advice to our clients. However we can allocate you an Authorised and Regulated Pension Specialist.
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