Notes
How much should I contribute to my stakeholder pension?
Contributions to stakeholder pensions can be as low as £20. But, even a regular monthly contribution of £20 over several years will not give you a large pension when you retire. And the older you are when you start saving, the less time there is for your pension fund to grow to something worthwhile.
Estimated pensions in the Pension Table
The Pension Table later on will give you a fair idea of the pension income you could get, depending on your age and contributions. But please remember that the figures in the table are only estimates and are not guaranteed. You may get less, or you may get more.
The pension figures are also shown before income tax. When you receive your pension during retirement you may be taxed on it. The current basic rate tax level is 20%.
The estimated pensions are based on the stakeholder pension charge limit of 1.5% for the first 10 years – (if the stakeholder pension scheme has kept to the original 1% charge limit on the fund, then the estimated pension figures in the Pensions Table will be higher). There's more about charges under the Further information section.
| The figures in the table are calculated on the basis of the following assumptions: | |
|---|---|
| Before you retire | |
| Before changes, your fund grows by | 7% a year |
| Charges deducted from your fund | 1.5% of fund a year for 10 years, then reducing to 1% |
| Tax rebates on contributions | Rebate of basic level tax at 20% |
| When you retire | |
| Your entire fund is used to buy an annuity, and you do not take any tax free lump sum. | |
| Annuity rates assume that the investment return after retirement is | 0.6% a year in excess of inflation |
| Your pension increases in line with inflation Your spouse will receive half your pension on your death. |
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