Site Navigation

• Full Review
• Mortgages
• Income Protection
• Pensions
• Critical Illness Insurance
• Life Insurance
• Private Medical Insurance
• ISAs
• Will Writing
• Business Insurance
• HIPS
• Banking

Recession delays retirement for millions

Published on 20th August 2009

For many, the dream of long days playing golf makes the long hours of Contracting worthwhile. However, the sad truth is that many people will be unable to retire at 65.

According to research by insurer LV, approximately 69% of those aged 50 or over are concerned about affording to retire. The same report states that two million people have already chosen to delay retirement due to the volatile economy and falling house prices and this number is set to rise unless people start putting more money aside for their retirement.
As a Contractor you may find it tough to work on through your 60s. Given the rapid technological change in your industry many find it difficult to justify the expense of training to ensure that your skill set is at its most marketable.

The good news is that you can benefit from significant tax breaks on pension investments and as such it offers a win-win situation in terms of providing a nest egg for your retirement. With Government finances in meltdown the emphasis needs to be on personal provision for retirement and as such the Government has made pension investment as easy and as tax efficient as possible in recent years.

Since the pension's simplification rules were introduced in 2006, you can invest virtually all of your contract income direct from your limited company.. It's not just Ltd company set-ups, which typically operate outside IR35, who can benefit. Contractors who use a PAYE umbrella company may also be able to take advantage of a salary sacrifice arrangement to reduce their tax bill.

As a contractor you need a pension that can be as flexible as you are, with the ability to adapt payment schedules and contributions to match your contracts and level of income on a monthly basis. You should also choose carefully when deciding on your pension provider, choosing a firm that has a good reputation and is a big player in the pensions market. This should help ensure that that you get the long-term commitment to product development that is needed to make the most of opportunities as they arise between now and your investment.

• Return to latest articles

News and Articles

Death of the self cert mortgages

With lending criteria becoming tougher by the day, it was only a matter of time before lenders started to pull out of the more risky products including Self-certification mortgages...

The dark truth behind unemployment cover for contract workers!

In these uncertain times, Contractors are increasingly drawn to insurance policies that offer the promise of a safety net in times of unemployment...

Opportunities in the current investment markets

With interest rates at an all time low, it is more important than ever to consider investing your savings rather than leaving them to gather dust in a high street savings account...

Testimonials

• The whole process was so quick and easy with no worries...

  Steve Birchall

• I would have no hesitation in recommending your company to others...

  Nick Williams

More testimonials