When and How You Should Start Saving For a Pension


Friday, September 26, 2014/Mike Krcmardo 


Following the economic crisis there’s been a general feeling of unease about job security which is why a lot of money experts have been advising people to start looking into various sources for a pension fund that will see them through their twilight years.


But for the younger generation who haven’t really been provided with a ton of information regarding pension investments this act can seem a little daunting. But according to John Lawson, the Heady of Policy for renowned pension provider Aviva: “Saving money involves prioritising things”.


This is because the first temptation upon getting your first wage packet is to either blow it on celebrations, various retail items or even pay off card or student debts. The best choice according to experts is to invest it wisely. As Lawson puts it, you have to learn to balance between short and long term priorities.


When it comes to investing in a pension the earlier you start the better. Lawson explains it as: “If an individual invested £1,000 in a pension at 30, within 35 years of investment they would see a 4% growth per year that would give them £3,950 by 65.”


The earliest you can start saving for a pension is 22 years old, when you’re automatically enrolled for a pension by your employer and earn more than the minimum amount of £9,440 a year.


Although there is an option of relying on a state pension this can be quite a bad move as currently state pensions are set to be roughly £144 by 2016 and some of those in employment may have to pay either more national insurance resulting in less cash or work longer before they can get their hands on it.


Another option is to try a private pension alongside your current employer’s pension scheme, this allows you to accrue a financial safety net for yourself should you wish to retire from your job early.


Private investments can take many forms, some choose company stock whilst others sink their cash into special investment accounts run by banks that slowly gain interest, there’s even an option of investing in gold.


Gold is quite a good choice amongst investors as there’s a great system of IRA gold. This stands for Individual Retirement Account and involves you buying gold to use as a stock market investment.


The investment itself can take the form of gold coins, bullion or even an EFT. Gold is a great choice for an early investment as it’s a stable currency and is constantly increasing in worth so it’s a pretty safe place to sink your money.


For more information about it you can check the IRA gold rollover guide if you’re still unsure about where to start. So when it comes to your future, your best bet is to start finding ways to fund your pension because that’s the only way you’re going to finance yourself in your final years.


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