Important things to consider when looking for a private pension

Choose the right private pension by knowing what to look for before you start investing.

14:24 20 January 2013

Choosing the best private pension is very important as you prepare for your golden years. It’s crucial that you pick the right one to maximize your return of investment and to ensure that you’ll maintain or even improve the quality of your life when you retire.

When looking for a private pension, there are several things that you need to seriously consider. First one is the rule for making contributions. You would want to know if there’s a minimum or maximum amount to pay every month or if putting lump sum is needed to get started. You also want to know what happens in case you needed to take a payment break.

Second thing to consider is the administration and set up charges. Bear in mind that although all kind of pension schemes have these fees, the amount greatly varies. So, when choosing, go with a great performing fund that doesn’t carry huge fees.

Another important thing to consider is if the pension scheme you choose will allow you to take out tax-free lump sum when you retire that you can use to buy annuity, which will pay you regular amount for the rest of your life.