Last week I was having a mentor session with an entrepreneur I have been working with for a couple of years. She’s had a successful 12 months with the products she’s launched, and told me she had over £100,000 sitting in her business bank account.

I asked her whether or not she had a pension, and she didn’t. So I recommended she open one before her business year end, and deposit £60,000 in it. This would not only give her a good starting point for saving for her retirement but, she was delighted to learn, it would also reduce her Corporation Tax bill by at least £11,400.

So how does this work?

How pension contributions reduce your business tax bill

If you run a limited company, you can invest up to £60,000 a year in a pension as a tax-free benefit. This means that the amount of money you pay tax on is reduced by the sum that you have put into your pension.

The small profits Corporation Tax rate for companies with profits under £50,000 is 19%, which means that for every £1,000 you invest in your pension, you could pay £190 less Corporation Tax. Here’s how much you can save for every £1,000 you invest:

• £1,000: £190
• £5,000: £950
• £10,000: £1,900
• £15,000: £2,850
• £20,000: £3,800
• £30,000: £5,700
• £40,000: £7,600
• £50,000: £9,500
• £60,000: £11,400

So even if you aren’t in the privileged position of having £60,000 to put into a pension, every penny that you can invest can help reduce your tax bill. Plus you’ll be benefiting from compound interest as you save for a more comfortable retirement.

How to save up to £15,000 a year in Corporation Tax

We have calculated these at the lowest rate of corporation tax, but if you are subject to a higher rate, you will save even more money.

For example, if your business profits are over £250,000 you will pay the main rate of Corporation Tax, which is 25%. If you were to invest £60,000 a year in your pension, this could save you a maximum of £15,000.

If your business profits are above £50,000 but below £250,000 you’ll be able to claim marginal relief. If you want an idea of what your tax might be, you can use free online calculators like this one.

You can carry forward your allowance from previous years

If you’re now kicking yourself that you didn’t take advantage of this before, we have more good news. Thanks to the pension carry forward rule, if you haven’t used all your pension allowance in previous tax years, you can carry the allowance forward for a maximum of three years.

So, if you have had an amazing year in business this year, and haven’t claimed any of your allowance from the previous years, you could also invest up to £180,000 in your pension which, at the main Corporation Tax rate would save you £45,000 in tax.

How to save in tax even if you don’t run a limited company

It’s not just limited company directors who can benefit from paying into a pension. If you are employed and meet the criteria, your employer must offer you a workplace pension scheme and contribute towards it.

There are benefits for freelancers, too. If you are self-employed, and a basic rate taxpayer you can get a 25% tax top up. This means that, for every £100 you invest in your pension, you’ll get another £25 from the government, making it £125.

As with the Corporation Tax benefit, you don’t need to be saving thousands into your pension to reap the rewards. Any money you put into your pension should work hard for you. So work out how much you can afford to invest now – then enjoy the tax benefits and long term rewards of compound interest.

Read more about pensions

Want to learn more about the benefits of pensions, and how to maximise your retirement income? We recommend checking out these articles:

• What kind of lifestyle could a £100,000 pension pot buy you?
• Two important reasons to consider ethical investing for your pension
• What to do if you have no pension at 50
• How safe is your pension?
  
  

The post How you can (legally) save as much as £15,000 a year in Corporation Tax  appeared first on Talented Ladies Club.

When you are working for an employer, you know how much you earn per year, and can plan a lifestyle you can afford around that. But what happens when you retire? What kind of a lifestyle will your pension buy you? 

To help answer this question, and to give you a goal to help you work towards (it’s always easier to stay motivated when you have a savings goal), we are going to look at three different sized pension pots, and get an idea of what kind of lifestyle you might be able to afford with each. 

We are going to look at pension pots of:

• £100,000
• £200,000
• £300,000

As well as looking at what each pension pot could buy you, we’ll also find out how much money you need to be investing now in order to save up a pension pot that size. 

How much money do you need to live on when you retire?

But first, let’s quickly look at how much money you might need to live on when you retire. 

According to the Pensions and Lifetime Savings Association’s (PLSA) Retirement Living Standards, if you are single when you retire, you would currently need:

• £14,400 a year for a minimum lifestyle
• £31,300 a year for a moderate lifestyle
• £43,100 a year for a comfortable lifestyle

And a couple would need: 

• £22,400 a year for a minimum lifestyle
• £43,100 a year for a moderate lifestyle
• £59,000 a year for a comfortable lifestyle

(You can read more about this and find out how ‘minimum’, ‘moderate’ and ‘comfortable’ lifestyles are defined here.)

What’s your ‘financial gap’ after receiving the State Pension?

In the UK, the full new State Pension for the 2025/2026 tax year is £11,973 a year, or £230.25 a week. This means that, if you are a single person, the current State Pension leaves you with a financial gap of:

• £2,427 a year for a minimum lifestyle
• £19,327 a year for a moderate lifestyle
• £31,127 a year for a comfortable lifestyle

And if you are in a couple, the gap you would need to fill is:

• Nothing for a minimum lifestyle (you will have an excess of £1,546 a year)
• £19,154 a year for a moderate lifestyle
• £35,054 a year for a comfortable lifestyle

It’s these gaps that a private pension can help you to fill. So let’s look at what kind of lifestyle different sized pension pots could give you. 

How much money should you take from your pension each year?

Before we look at how much your pension can pay you, we need to work out how much you can take from your pot each year. Once you retire, you are likely to have a finite amount of money to last you, and the more you withdraw to live on, the quicker you’ll run out of funds. 

This is where the 4% pension rule, or ‘safe withdrawal rate’ comes in. The concept is credited to US financial planner, William Bengen, and works on the presumption that if you start by withdrawing 4% from your pension pot and increasing this each year by the rate of inflation, you are unlikely to run out of money over a 30-year period.

So, for example, if your pension pot is worth £500,000, you would withdraw £20,000 in the first year of your retirement. Then, if inflation is 2% in that year, the next year you would withdraw £20,400. 

We will use the 4% rule to work out the income you could get from different-sized pension pots.

What income will you get from a £100,000 pension pot?

So what income might you get with a £100,000 pension pot? A £100,000 defined contribution pension could give you a starting income of £4,000 a year, or £333 a month, if you withdraw 4% each year. 

This is assuming you don’t take the 25% tax-free cash upfront. If you do choose to take your full tax-free allowance at the start, you would be left with a pension pot worth £75,000. This could give you an initial income of £3,000 a year, or £250 a month if you followed the 4% rule.

How to take money out of your pension

If, when you start to draw down your pension, your money is still invested in the stock market, you’ll find that the value of your pot will change every day. To make things easy, you might decide to withdraw an amount at the beginning of each year, and put it in a savings account with a good interest rate and easy access. You can then pay yourself a set amount each month – much like when you earned a salary. 

You’ll need to make sure that the amount you pay yourself increases each year in line with inflation. (You can see how inflation could impact your retirement savings using PensionBee’s Inflation Calculator.) And, to reduce the risk of running out of funds, you should aim to achieve annual returns over 4% on your invested money. Also remember to factor in the fees charged by your provider.

What lifestyle will a £100,000 pension pot buy you?

So what kind of lifestyle will a £100,000 pension pot buy you? Let’s look again at the Retirement Living Standards and the gaps left after you receive the full new State Pension, and factor in your private pension income. 

If you are a single person you will now have a gap of:

• Nothing for a minimum lifestyle (you will have an excess of £1,573 a year)
• £15,327 a year for a moderate lifestyle
• £27,127 a year for a comfortable lifestyle

And if you are in a couple, the gap you would now have is:

• Nothing for a minimum lifestyle (you will have an excess of £5,546 a year)
• £15,154 a year for a moderate lifestyle
• £31,054 a year for a comfortable lifestyle

(These figures assume you receive the full new State Pension and a £4,000 income from a pension pot of £100,000.)

What lifestyle will a £200,000 pension pot buy you?

If you have pension savings of £200,000, you could achieve an initial income of £8,000 a year, or £667 a month, if you withdraw 4% (again, this assumes you don’t take your 25% tax-free allowance at the start). 

If you are a single person receiving the full new State Pension and withdrawing £8,000 a year, this means you will have a gap of:

• Nothing for a minimum lifestyle (you will have an excess of £5,573 a year)
• £11,327 a year for a moderate lifestyle
• £23,127 a year for a comfortable lifestyle

And if you are in a couple, the gap you would need to fill is:

• Nothing for a minimum lifestyle (you will have an excess of £9,546 a year)
• £11,154 a year for a moderate lifestyle
• £27,054 a year for a comfortable lifestyle

What lifestyle will a £300,000 pension pot buy you?

And finally, if you have a £300,000 pension pot, you could live on an initial annual income of £12,000, or £1,000 a month, if you withdraw 4% and don’t take your tax-free allowance at the start.

If you are a single person receiving the full new State Pension and withdrawing £12,000 a year, this means you will have a gap of:

• Nothing for a minimum lifestyle (you will have an excess of £9,573 a year)
• £7,327 a year for a moderate lifestyle
• £19,127 a year for a comfortable lifestyle

And if you are in a couple, the gap you would need to fill is:

• Nothing for a minimum lifestyle (you will have an excess of £13,546 a year)
• £7,154 a year for a moderate lifestyle
• £23,054 a year for a comfortable lifestyle

How to grow a pension pot of £100,000, £200,000 or £300,000

So how much do you need to invest if you want to retire with a pension pot of £100,000, £200,000 or £300,000? 

If you have no pension savings right now, and want to retire at the age of 66, the table below shows you how much you need to pay into your pension each month. These calculations assume your investment grows by an average of 5% a year, inflation is 2.5% and you pay management fees of 0.70% a year. They have been calculated using PensionBee’s Pension Calculator, and include tax relief and any potential employer contributions.

It’s also important to remember that when you pay money into a pension, you could benefit from tax relief – which is effectively ‘free’ money from the government that’s added on top of your pension contributions. Usually basic rate taxpayers get a 25% tax top up; meaning HMRC adds £25 for every £100 you pay into your pension making it £125. Higher and additional rate taxpayers can claim a further 25% and 31% respectively through their Self-Assessment tax returns.  

PensionBee’s Pension Tax Relief Calculator shows you how much tax relief could be added to your pot and will tell you whether or not you need to file a Self-Assesment to claim a portion of it. If you’re employed, and meet the criteria, your employer will also make contributions that will help to boost the value of your pension pot. So building up a six-figure pension pot is less daunting than you may think.

Risk warning: As always with investments, your capital is at risk. The value of your investment can go down as well as up, and you may get back less than you invest. This information should not be regarded as financial advice.

About PensionBee

PensionBee can help you combine your old pension pots into one easy-to-manage online plan that lets you keep track of your balance, make flexible contributions, invest in line with your values and make withdrawals from the age of 55, rising to age 57 in 2028. For more information, visit PensionBee.

Learn how long your pension could last with the PensionBee Pension Calculator.

Follow @PensionBee on X, Threads, Instagram, TikTok, Facebook and LinkedIn.

The post What kind of lifestyle could a £100,000 pension pot buy you? appeared first on Talented Ladies Club.

For many of us, a pension isn’t something we think much about. At worst, we try to ignore a niggling worry that we haven’t done anything (or enough) to start saving for our future. And at best we automatically pay money into a pension we may have chosen many years ago without thought. 

If you’re in the latter group, it’s highly likely you have no idea where your money is actually invested. Indeed, research by the Pensions and Lifetime Savings Association (PLSA) found that while 82% of pension savers understand that their pension is invested, only 26% actually know what it’s invested in.

So why does this matter? Aside from ensuring that your money is getting a healthy return, and you aren’t over-paying on fees, reviewing your pension and consciously choosing where your money is invested is a wise idea. 

Here are two important reasons why. 

1) You can put your money where your values are

Some people would never willingly support the fossil fuel, fast fashion, pornography or weapon industries. Or choose to invest their money in countries with regimes whose values they disagree with. However the simple truth is that, without knowing where your money is invested, you could be doing just that. 

This is why it is important to make a conscious choice about how your pension is invested, and choose funds that align with your values. 

According to the Make My Money Matter campaign, 68% of UK pension holders want their investments to balance people and the planet with profit. If this resonates with you, the good news is that you have plenty of options today. 

For example, PensionBee’s Climate Plan aims to achieve net zero emissions by 2050, in line with the goals of the Paris Agreement. The plan is designed to gradually reduce your pension’s investment in polluters and heavy carbon emitting companies. It does this by continually reducing the total intensity of the greenhouse gas (GHG) emissions produced by companies in the plan by at least 10%. This helps you to take your climate action to the next level with your pension.

PensionBee also have a Shariah Plan that only invests in Shariah-compliant funds – a branch of socially responsible investing shaped by the Islamic faith. All investments are approved by an independent Shariah committee, and exclude alcohol, gambling, tobacco, military equipment or weapons, pornography and any products containing pork.

With plans like these easily available today, you can ensure that your money works not just for your good, but helps benefit the causes and business sectors you support, too. 

Conscious investing means seeking out investment funds and pension plans that can help to support your values or beliefs, and avoiding your money contributing to industries you don’t agree with. 

2) You can enjoy better financial returns

If you like the idea of investing in industries and companies you agree with, we have more good news: you don’t need to sacrifice returns in order to enjoy a clear conscience.

According to the latest Good Investment Review, over the past few years, actively managed sustainable funds (‘green funds’) have performed relatively well compared to more traditional funds (‘brown funds’) – despite tricky market conditions. 

They may also be a safer choice for the future. 

Thanks to a greater awareness of sustainability and increased criticism of companies that do harm to the environment, brown funds could be impacted by greater government regulation and financial penalties. They are also more vulnerable to environmental news stories. A study by the EDHEC Climate Institute found that, “brown assets are negatively exposed to climate risk (more risk and concern reduces their returns) as measured by climate news.”

And finally, sustainable funds have demonstrated a greater resilience in economic downturns; 61% of Morningstar’s ESG-screened indexes out-performed their market equivalents in 2021. 

No wonder then, that analysts are optimistic green funds can potentially enjoy strong returns over the long term. 

Of course, there are no guarantees that a more ethically responsible investing strategy will yield better, or even similar, results than investing in traditional funds – as with all investments, sustainable funds are subject to changes in market conditions so their value may go down as well as up. 

However, as you can see there are good financial reasons to consider investing in the future of the world you want to see, while planning for your own. 

Is an ‘ethical pension’ right for you? 

Whatever your personal values or beliefs, one thing is absolutely certain – saving for your future, if possible, is important.

According to the The Pensions and Lifetime Savings Association’s (PLSA) Retirement Living Standards, the State Pension alone will currently not enable a single person to afford a minimum lifestyle. And it will leave a couple £20,100 a year short of being able to afford a moderate lifestyle. 

If you want to avoid struggling in your retirement – or being forced to work significantly past the age you wish to retire – you need to be saving into a pension now. (You can use the PensionBee Pension Calculator to find out how long your pension could last.)

There are potentially great incentives to do so, too. Not only will your money benefit from the power of compound interest, but you may also get help in the form of contributions from your employer, tax top-ups if you are employed or self-employed, and tax relief if you are a director of a limited company. 

And you can enjoy all this while knowing your money is invested in companies whose values and vision aligns with yours. 

If you’d like to know more about sustainable investing, or want to start or move a pension, you can read more here or listen to episode 36 of The Pension Confident Podcast. In this episode, the guests discuss how you can find out where your pension is invested, what makes a sustainable fund and what actions you can take to influence positive change with your pension.

Risk warning: As always with investments, your capital is at risk. The value of your investment can rise or fall, and you could receive back less than you invest. This information should not be considered as financial advice.

About PensionBee

PensionBee can help you combine your old pension pots into one easy-to-manage online plan that lets you keep track of your balance, make flexible contributions, invest in line with your values and make withdrawals from the age of 55 (rising to 57 from 2028). For more information, visit PensionBee.

Learn more about PensionBee’s Climate Plan. 

Follow @PensionBee on X, Threads, Instagram, TikTok, Facebook and LinkedIn.

The post Two important reasons to consider ethical investing for your pension appeared first on Talented Ladies Club.

Actually that is a lie. I briefly started a company pension in my 30s… about four months before I resigned! Given that this will probably be worth around £10 a year, I’m pretty sure it doesn’t truly count when considering retirement income.

So, my baby pension aside, as I got to the end of my 40s and started to think about the next decade approaching, I grew quite worried. Retirement had always seemed so far away, and I had always assume that something would come up to cover me financially.

What I hadn’t realised was that ‘something’ needed be to planned by me. And I was leaving it worryingly late.

It’s not that I’d never appreciated the importance of a pension; an IFA explained how valuable it was to start saving early when I was in my 20s. The problem is that, for most of my working years, I didn’t have the spare cash available to put into one. I was either saving for the deposit on my first property, paying off the mortgage, saving for renovations, or on maternity leave.

There was always some expense that meant that I needed every penny in my pay check for my present. I just didn’t have the luxury of putting anything away for my future. I was also wary of pensions, thanks to Robert Maxwell, and wasn’t aware of how safe pensions are today.

A third of women over 50 have no private pension

I know I’m not alone in this. According to The Guardian, a third of women over the age of 50 have no public pension, private pension or company pension. Research by Sunlife also found that 33% of women over the age of 55 were relying solely on the State Pension.

So what am I doing to prepare for my future? I have two rental properties, and I am overpaying the mortgages on them so they will both be mortgage free by the time I am 65. I also started a company pension three years ago and am putting every penny I can into that.

If you have a limited company, this might be an option worth looking at too, as it’s a tax efficient way of saving your money. By investing direct from your company (rather than paying yourself) you aren’t subject to dividend tax on the money.

Pension payments are also usually an allowable deduction for corporation tax. And as of April 2023, the annual allowance for tax relief on pension savings in a registered pension scheme rose to £60,000. So you can invest in your future and cut your tax bill. Win-win!

Even if you don’t have a limited company, it’s still worth starting to save; it’s never too late. And there are benefits if you’re self-employed or employed. We go into pension tax benefits more comprehensively here (and I highly recommend reading the article), but for a quick run-down:

• If you’re self-employed and a basic rate taxpayer, the government will usually give you a 25% tax top up on anything you contribute to your personal pension. So if you invest £100, you’ll get another £25 from the government, making it £125.
• If you’re a higher or additional rate taxpayer and you are self-employed, you can claim further tax relief through your Self-Assessment tax return too.
• If you are employed and earn more than £10,000 a year, your employer must offer you a workplace pension scheme and contribute towards it.
• If you earn less than £10,000 but above £6,240, your employer doesn’t have to automatically enrol you in their scheme. However, if you ask to join, your employer can’t refuse you and must make contributions.

How much do you need to save for your retirement?

When working out how MUCH you need to save, the first thing to consider is how much money you will need when you retire. According to the government’s Target Replacement Rates (TRRs), you take a percentage of your current salary as a target income for retirement. What this percentage is changes depending on how much you earn now:

• If you earn less than £14,500 you need 80%
• If you earn £14,500 to £26,999 you need 70%
• If you earn £27,000 to £38,499 you need 67%
• If you earn £38,500 to £61,499 you need 60%
• If you earn over £61,500 you need 50%

So if you are earning £40,000 now, you should need around £24,000 a year when you retire.

If you have paid national insurance for 35 years, the state pension should pay £11,500 a year from April 2024, which means you’ll need to cover the remaining £12,500 through private or workplace savings or other income sources to maintain your standard of living.

You could also compare reverse mortgage loans as a way to unlock the value of your home for extra income in retirement, especially if downsizing isn’t an option.

Of course this is a rough guide. It might be that your expenses reduce dramatically as you get older, and you need less to live on. Your kids should become less financially reliant on you, and you may pay off your mortgage, for example.

When working out how much you might need, ask yourself these questions:

• How much will your monthly outgoings be? Think rent/mortgage, utilities, gym membership etc.
• What kind of lifestyle do you want? Do you want to travel or potter in your garden?
• What standard of living do you want? Do you enjoy luxuries or aspire to the simple life?

Look at what kind of expenses your money goes on now, and how much they are. Do you want to maintain those as you get older, or are you happy to reduce your spending?

Also consider what sources of income you may have already, including your state pension, any company pensions you may have paid into (even if, like mine, they are tiny!), any properties you own or existing savings. You can also speak to an expert about selling your annuities and get some figures for that to add to your numbers – it’s well worth exploring every avenue. 

To find out exactly how much you need for retirement, you can use a free online pension calculator, like this one from PensionBee.

How can you bridge your pension gap?

Once you are done, look at your pension shortfall. Don’t be afraid to be realistic about how much you are missing. By confronting the truth now you can make changes to reduce or even eliminate it – while you still have time. It’s much worse to sleepwalk into a financially tougher retirement than you realised, or find yourself needing to work much later than you’d hoped.

Once you know what the shortfall is, you can start to make plans to bridge the gap.

Look at what your financial situation is right now. Make a record of all your monthly outgoings – including your essentials (rent, mortgage, food, council tax, heating etc) and your non-essentials, such as gym membership and subscriptions like Netflix. List the total monthly outgoings for each – essential and non-essential.

Next list all your sources of monthly income – your salary, dividends, income from properties, interest on savings… any money you have coming in. Then calculate the difference. After deducting all your monthly outgoings, how much do you have left over?

Now go through your list of essential outgoings and look for ways you can reduce them. Can you negotiate better deals, swap providers or switch to more economical versions (for example, supermarket own brands)? Challenge yourself to see how much you can reduce your monthly total by.

Then tackle your non-essentials. Are there any you can do without? Or find cheaper alternatives? Again, see how much you can cut from your monthly costs.

The goal here is to have as much money as you can each month available to start investing in a pension or savings plan. Every penny now counts!

Why pensions are the best way to save for your future

And the good news is that, even if you have left it late, you can still benefit significantly from starting a pension, thanks to tax benefits and compound interest. Let’s look at Jo as a theoretical example.

Jo’s situation

Jo is 55 and plans to retire in 10 years, but hasn’t yet started a private pension. She’s self-employed and earns £30,000 a year. Jo decides to start a pension and pay in 7% of her gross income, which is £175 a month, deducted before tax.

How much can Jo save for retirement?

If Jo continues this for 10 years and averages growth of 4%, that means she’ll have over £32,000 when she retires. However, she’s actually paid in just £21,000. For comparison, in order to achieve the same performance, an ordinary investment fund would need to return a consistent 8% interest a year.

What can Jo take from her pension when she retires?

If Jo opts for pension drawdown when she retires, she could take around £2,100 a year from it until she is 88. And remember: the pot still has the potential to grow during this time as the remainder of her pension pot is still invested.

This means she may be able to withdraw around £49,000 in total, depending on market performance. All from a £21,000 investment, which means Jo has more than doubled her money. 

While £2,100 a year may not seem a lot, that could be a nice holiday, or more money for every day luxuries like eating out with friends, or trips to the theatre – treats you may not be able to afford without your pension.

So please don’t think you’ve left it too late to start saving towards your retirement, and take advantage of the tax benefits and compound interest that pensions offer.

If you’re five or 10 years younger than Jo you have even longer to save up money, and to potentially benefit from interest-based growth. You will probably also decide to retire later, as most of us won’t start receiving our State Pension until we are 68 or even older. That should give you 18 years to save up if you are 50 years old.

Start saving for your retirement today – even if it’s not far off!

I hope this article has helped reassure you that it is not too late to start saving for an easier future, even if you are in your 50s. If you’d like to learn more about pensions, I recommend watching the free pensions class we ran in partnership with PensionBee here.

We’ve packaged it as a free mini-course with a workbook to help you take positive action for your future. Watching it could be one of the best financial decisions you make.

The post What to do if you have no pension at 50 appeared first on Talented Ladies Club.

I didn’t want anyone to miss out, so I have gathered the questions from the webinar. Some were answered in chat by Becky O’Connor, PensionBee’s Director of Public Affairs. I have copied her answers over here. And any questions she wasn’t able to get around to, I have answered for you.

Hopefully this will be a helpful resource.

How can you work out how much income you’ll get from your pension pot each year? 

You can see how much you might get per year from your pension pot using handy online calculators, like this one from PensionBee. 

How many years retirement should you plan for, if for example you plan to retire at 67 years?

30 years is a sensible and cautious estimate. The average life expectancy for women is approaching the mid-80s, but of course, the big unknown is how long any of us will live for. It’s good to go on probabilities.

Is there a way of working out how much your pension pot will reduce by, year on year, when you start to take drawdown, in order to see how long the pot will last?

You can use a drawdown calculator, like this one from Which! to see how long your pension pot will last, depending on how much you tax a tax-free lump sum, how much you want to withdraw each year and how much interest you may earn, etc.

How do you know if you qualify for the full state pension?

To qualify for the full State Pension, you will need a total of 35 years of NI contributions or credits by the time you retire. To find out how much State Pension you are entitled to you can check here.

If you don’t have enough qualifying years you can pay voluntary Class 3 contributions to fill gaps in your National Insurance record to qualify for the State Pension. You can find out more here. 

Is it worth deferring your State Pension?

If you wish, you can choose to defer your State Pension and increase the amount you receive each month when you do take it. If you defer for one year, after April 2025 you will get just over £670 a year more. However, you will have ‘lost’ the approximately £11,500 you would have otherwise have been paid.

So is it worth deferring? The hope is that you would get the amount you missed out on back and more over time – indeed this is usually the case. Of course there is always a risk is that you wouldn’t live long enough to make it back.

Is it worth taking a deferred benefits pension a couple of years early?

If you decide to take your deferred benefits early, they will usually be reduced to reflect the fact that your pension will be paid for longer. How much reduction is applied will depend on how early you choose to take them.

Is investing in a property a viable alternative to a pension?

While many people include a property as part of their retirement financial planning, you may not want to rely on it solely in place of a pension. 

The issue with depending on property for your retirement income is that it’s not quick or easy to turn into spendable cash. Yes, you would have an income from any rent paid to you by tenants, but what if your tenants default on rent, your property is unoccupied, or you have expensive repairs? 

Relying solely on property for your pension is one of those ‘eggs in one basket’ scenarios that is generally wiser to avoid. 

How does an annuity work and is it better than property income?

An annuity is an income that is paid to you for a fixed period of time or for the rest of your life. On the plus side, this gives you the peace of mind of knowing your pension is guaranteed to last. You may also have the option to pass your annuity on to your beneficiaries, depending on the type you have and if you’ve started receiving income.

However, annuities can be complex and can have high fees. Purchasing an annuity is also irreversible. 

Income from a property is less reliable and consistent than an annuity, as it depends on your property being rented out, your tenants paying and not having expensive repairs. However, you do have a sellable asset (your property) and you are free to leave your property to whoever you wish when you die. 

Many people prefer to see pensions and property less as an ‘either or’ option, but instead choose to create a portfolio of retirement income streams. You can read more about the pros and cons of pensions here.

I’ve heard a lot about SIPPs. Are these tax free (like ISAs) or are they taxed in the same way as other pensions?

Like pensions, SIPP contributions get tax relief upfront, but your withdrawals are taxed. ISAs don’t have tax relief, but your income and gains are tax-free.

Can I start a pension for my child?

Yes, a child can have a pension from birth – there’s no minimum age for starting one. A pension can only be set up by the child’s parent or guardian, but once it’s started, anyone can contribute. 

You can pay up to £2,880 into a child’s pension. With 20% tax relief from the government, this adds up to £3,600.

What are the options for starting a pension for my daughter who’s age 19, a university student, and is self-employed part-time?

Your daughter can start a pension – the earlier she does the better, even if she’s only saving a small amount now. And as she is self-employed she’ll get tax relief on her contributions too, even she doesn’t earn enough to pay tax, as we cover further down.

Do you have to be a nominated beneficiary on your spouse’s pension, even though you are married?

No, you don’t need to nominate a spouse or registered civil partner. If you have not nominated anyone else, they will receive all of your adult dependant’s pension and lump sum benefits when you die. 

If you have previously nominated someone, such as an ex-partner, they will receive any benefits, even if you have remarried. So it’s important to check who you have nominated, especially if you have divorced. You can cancel or change a nomination by completing a new nomination form.

What protection is available if your pension provider goes under before you retire?

There are a number of protections for pensions. The Financial Services Compensation Scheme (FSCS) protects you for up to £85,000 per person, per institute. And, provided your pension provider is has been authorised by the Financial Conduct Authority (FCA), it is covered as following way:

• If you have a private pension and it fails, the FSCS will cover 100% of your claim with no upper limit.
• If you have a SIPP and your operator fails, you are protected by up to £85k per person, per institute.
• If you have received bad pension advice, you can claim compensation up to £85k per eligible person, per firm.

What happens if you die before pension age? What happens to any pension pot you have contributed to?

If you die before you’ve used up your pension pot, its value will usually be paid to your beneficiaries. These can be a dependant or a nominee. If you die before the age of 75, any benefits paid to your beneficiaries will normally be tax-free. However, if you die after the age of 75, they will be subject to income tax.

What’s the best way to locate lost pensions? For example if you know who you were employed by but not the pension details?

The Government have a free pension tracing service. Your employer name should be enough to go on.

I have found an old pension sitting dormant, but obviously admin fees are being taken out. What can I do about it?

If you have another pension, you may choose to combine them.

What you need to look out for when considering whether to consolidate several small pension pots?

Combining several small pension pots into one can make sense, as it’s easier to manage.

One of the things to look out when deciding whether to combine pensions is fund performance. If you have a number of small pots, you may find that one has outperformed the others. However,  past performance is not a guide to future performance, so check the consistency of your funds’ performance over time.

It’s a good idea to speak to a financial advisor before making any significant decisions, as they can help you assess your options and take into account things like your risk profile. 

Are the pension figures pre- or post-income tax? 

The figures we use in this pension article are pre-tax.

What happens if you don’t pay tax? Would the government still top up the 25% in that situation?

If you don’t pay tax and you still want to pay into a pension, you can still get tax relief on contributions up to £3,600 (£2,880 net).

Is it possible to back date tax support for business owners if you’ve not made use of it previously?

Yes, you can claim back tax relief for the last four tax years. It’s also worth noting that, if you are a higher-rate taxpayer, you could reclaim an additional 20% tax on your self-employed pension contributions, for a total of 40% tax relief. However, this relief isn’t automatic – you have to claim it.

What are the options to optimise the lost pension contributions made at previous employments?

Those pension pots you are no longer paying into will still hopefully be growing in value even though you aren’t contributing. If you are in an existing workplace scheme it’s best to keep contributing to that as you have employer contributions going in too.

If you don’t think old ones are growing enough you could consider moving them to a higher growth focused pension plan either with that provider or with a new one. Also, check charges on old schemes. Old policies have a tendency to have higher charges that can eat away at your returns.

Risk warning: As always with investments, your capital is at risk. The value of your investment can rise or fall, and you could receive back less than you invest. This information should not be considered as financial advice.

About PensionBee

PensionBee can help you combine your old pension pots into one online plan that lets you keep track of your balance, make flexible contributions, invest in line with your values and make withdrawals from the age of 55. For more information, visit PensionBee.

Learn how long your pension could last with the PensionBee Pension Calculator.

Follow @PensionBee on X, Threads, Instagram, TikTok, Facebook and LinkedIn.

The post Your pension questions answered appeared first on Talented Ladies Club.

When we’re younger – when we SHOULD start saving for a pension if we’re savvy, retirement seems a long way off. We assume we have plenty of time, and besides, there are lots of things we’d rather or need to spend our money on now.

As the years go by, life continues to be expensive. We have rent, maybe a mortgage, bills, holidays, weddings, babies, DIY… there’s plenty of competition for our hard earned money, and finding the money for a pension, which still feels far away, might never make it to the top of our list of priorities. Or perhaps the spare money just isn’t there. 

Then one day, often after you turn 50, you realise that retirement is scarily closer than you think, and you haven’t prepared for it as much as you may have hoped.

But, while yes, it’s true that the best time to start saving for a pension is in your 20s, you don’t need to panic quite yet as the next best time to start is now. With some thoughtful planning there’s still lots you can do to help you enjoy your retirement. And that’s what we want to help you do. 

With that in mind, the aim of this article is to demystify pensions, to answer your pension questions, help you feel more in control of your finances, and empower you to take positive action for your retirement right now – whatever your situation.

To start, let’s explore what a ‘pension’ actually is, and how they work. 

What is a pension?

A pension is a tax-efficient way of saving up money to give you an income to live on in your retirement.

In the UK, if you qualify, you can receive the State Pension from the age of 66 (this will rise to 67 in 2028). You may have a workplace pension, where you and your employer both contribute. You can also save up for a private pension.

You can save money into several different pensions as long as you stay within the annual limits. You can read about the protections that exist to keep your pension safe here.

When can you withdraw your pension?

If you wish, you can start withdrawing your pension from the age of 55 (this will rise to 57 in 2028).  You can take up to 25% as a tax-free lump sum and then decide what you want to do with the rest. You might choose to begin withdrawing some of your money via pension drawdown, buy an annuity, set up a regular withdrawal or even keep paying into your pension. 

It’s important to note that, if you do decide to withdraw money from your pension and keep paying in, you could be subject to the Money Purchase Annual Allowance (MPAA). The MPAA restricts your pension contributions eligible for tax relief. For tax year 2023/24 the MPAA is £10,000.

How can you take money out of your private or workplace pension?

So what happens when you want to retire? How can you actually take money out of your pension? There are a few ways people take money from their private and workplace pensions:

• Buying an annuity
• Pension drawdown
• Taking a lump sum
• Regular withdrawals

If you have an NHS pension, you can read answers to some of the most common questions asked about the scheme here. You can also learn more about public pensions here.

What’s an annuity?

You can use your pension pot to buy an annuity from an insurance company. An annuity is an income that is paid to you for a fixed period of time or for the rest of your life. The amount you receive is determined by your annuity rate.

The final annuity income you might get depends on variables like your age, health and where you live. As a rule, the older you are, the higher the annuity rates you may be offered. There are many different types of annuities that you can buy, so you can find the one that suits you best. 

• Benefits of an annuity: You have a guaranteed income for a fixed period of time or for life, your pension is guaranteed to last and you may have the option to pass your annuity on to your beneficiaries depending on the type you have and if you’ve started receiving income.
• Potential downside of an annuity: Annuities can be complex, may have high fees and purchasing an annuity is irreversible. 

What’s pension drawdown?

With pension drawdown, you can leave your pension invested, and take money flexibly as and when you need it. Unlike an annuity, pension drawdown doesn’t give you a guaranteed income for life, but it does offer flexibility and you can still pass on your pension to your beneficiaries.

You can draw down your pension from the age of 55 (this rises to 57 in 2028). You can also take up to 25% of your pension completely tax-free. This can be as a lump sum or in portions. The remainder of your pension will stay invested and can be withdrawn as and when you wish. Remember that you will need to pay income tax on anything you take over your 25% tax-free amount.

• Benefits of pension drawdown: You can withdraw your income flexibly and can change how much and when you get income from your pension.
• Potential downside of pension drawdown: The size of your pension pot can increase or decrease, depending on how your investments perform and you won’t have a guaranteed income each month as your pension isn’t necessarily guaranteed to last your whole life.

With PensionBee, you can set up regular withdrawals. This is a type of pension drawdown which can help you manage your retirement income and instead of manually withdrawing the money, you can set up a regular payment.

How can you take a lump sum?

You could take a portion of your pension pot as a lump sum and leave the rest invested to draw down from it as and when you need. Withdrawing a chunk of your pension cash, rather than the whole lot, could also mean you pay less tax but remember only 25% of your pension pot can be taken tax-free. 

Withdrawing a large amount could potentially push you into paying higher rates of income tax and means your money no longer has the opportunity to grow within the pension. You might be able to avoid this by spreading smaller withdrawals over several years. You also don’t need to take all of your tax-free cash at once. 

You could decide to pay tax on part of a withdrawal, so in future years you can still top up your income with tax-free cash. Let’s say you wanted to take 10% of your pension out as a lump sum. You could opt to take 5% out of your tax-free allowance and pay income tax on the other 5%.

How can you combine an annuity, taking a tax-free lump sum and pension drawdown?

If you wish, you can combine taking a tax-free lump sum with an annuity and pension drawdown. You could tax your 25% tax-free lump sum, use part of your pension to buy an annuity and leave the rest invested to draw down from when you wish. Combining may give you the predictability of an annuity with the flexibility of pension drawdown.

You can read more about the pros and cons of pension plans here.

How much money do you need when you retire?  

Now we have an understanding of what a pension is, let’s look at how much you might want to save up for your retirement. There are different ways to save for retirement and one option to consider is a defined contribution pension transfer.

All too often, when we think about pensions, we panic, assuming we need a bottomless pot of money that is impossible to acquire, especially if we have left it late to start saving. 

We find it can be helpful to flip your thought process around, and instead consider what kind of retirement you want, and how much that lifestyle may cost. We can then have a better idea of how much money you might need saved up for your retirement, and what you need to do now to get close to that. 

So, in this article we’re going to explore three key areas:

1. What kind of retirement do you want?
2. How much money do you realistically need for it?
3. How can you get that money?

We want you to leave this article with a clear action plan to help you start saving for your ideal retirement. 

What kind of retirement do you want?

To start, think about what kind of retirement you want. For example, do you envision yourself jetting off around the world on five star holidays and dining in expensive restaurants when you give up work? Or do you dream of pottering around your garden and enjoying the simple life?

As you can imagine, these two scenarios require very different levels of funding. So ask yourself how you see yourself spending your time once you finish working. And then consider what kind of budget that might require. 

To help you, The Pensions and Lifetime Savings Association’s (PLSA) Retirement Living Standards, calculates that, if you are single when you retire, you would need:

• £14,400 a year for a minimum lifestyle
• £31,300 a year for a moderate lifestyle
• £43,100 a year for a comfortable lifestyle

And a couple would need: 

• £22,400 a year for a minimum lifestyle
• £43,100 a year for a moderate lifestyle
• £59,000 a year for a comfortable lifestyle

So what do these different lifestyles mean? Here’s how they define them:

• A minimum lifestyle covers all your needs, and gives you some left over for fun, such as the odd meal out. It doesn’t cover the cost of a car, but does include a long weekend away in the UK every year. It also gives you £54 a week for food, and up to £580 to spend on clothing and footwear a year.
• A moderate lifestyle allows for more financial security and flexibility, and can afford you two weeks in Europe a year. It will cover the costs of a three year-old-car, changed every 10 years, and gives you £74 a week for food and up to £791 to spend on clothing and footwear. 
• A comfortable lifestyle gives you more freedom and some luxuries, such as three weeks in Europe a year. It also covers replacing your kitchen and bathroom every 10-15 years, the cost of a two year-old-car, changed every five years, £144 a week for food, and up to £1,500 for clothing and footwear. 

Think carefully about these three levels of lifestyle and consider how you’d like to spend your retirement years. It may be that you’re not bothered about a newish car or three-week holidays, but you’d like to eat out often.

It’s also worth considering when you want to retire. Obviously, the later you leave it, the more you can save, and the more you’ll have to spend when you do. If funds are tight, delaying retirement could be a strategy to consider. 

When you have an idea of how much money you’ll need when you retire, you can then start to formulate a plan of action to achieve it. Find out what kind of lifestyle you could expect on a pension pot of £100,000.

How much State Pension will you get?

The first thing to remember is that you probably don’t need to find ALL this money each year. If you qualify for the full new State Pension you’ll currently receive £203.85 a week, or £10,600.20 a year for tax year 2023/24. (This rises to just over £11,500 a year for tax year 2024/25). You can check how much State Pension you’re eligible for and if you can retire before State Pension age here.

If you’re eligible for the full new State Pension, you only need to save enough to fill the gap left between your ideal lifestyle and your State Pension income. 

So from April 2024, if you are a single person this gap would be:

• £2,900 a year for a minimum lifestyle
• £19,800 a year for a moderate lifestyle
• £31,600 a year for a comfortable lifestyle

And if you are in a couple, the gap would need to fill is:

• Nothing for a minimum lifestyle (you will have an excess of £600 a year)
• £20,100 a year for a moderate lifestyle
• £36,000 a year for a comfortable lifestyle

How to boost your State Pension by deferring it

Not many people are aware that they can choose to defer their State Pension and increase the amount they receive each month. If you delay receiving your State Pension for more than nine weeks, it will rise each week. The rise is equivalent to:

• 1% for every nine weeks you defer
• 5.8% for every 52 weeks you defer

If you defer for one year, after April 2025 that means you will get just over £670 a year more. 

How to fill the gap between the cost of your desired lifestyle and your State Pension

So, now you know what kind of lifestyle you want when you retire, and how much this may cost. You also know what you might get in terms of your State Pension, and the gap that needs to be filled by your private/ workplace pensions or other incomes such as rental and investments. 

Next we’re going to look at how you may be able to fill that gap.

Check you don’t have a pension pot or investments you’ve forgotten about 

A starting point is to check you don’t already have a pension pot you have forgotten about. To find out, you can check here. You may decide to combine any existing pension pots into one, to make it easier to manage.

Check any other potential sources of retirement income

It’s also important to consider other forms of income you may have overlooked. This can include investments and rental properties. For example, if you have a rental property that earns you £12,000 a year after expenses and tax, that’s £12,000 a year you can deduct from your retirement  needs. 

Saving into a private pension 

So now we know:

• What kind of retirement you want
• How much this might cost
• How much State Pension you might get
• Any other existing income
• The gap you need to fill

For the next step, we’ll look at your private pension options. When saving into a private pension, you have a few choices, depending on your employment status. 

Saving into a workplace pension

The good news is that, if you are employed, even part-time, by law your employer must offer you a workplace pension scheme and contribute towards it if you are:

• At least 22 years old
• Have not reached State Pension age
• Earn more than £10,000 a year
• Are not already a member of a suitable workplace scheme.

If you earn less than £10,000 but above £6,240, your employer doesn’t have to automatically enrol you in their scheme. However, if you ask to join, your employer will be unable to refuse you and must make contributions on your behalf.

Saving into a pension if you are self-employed

But what if you work for yourself? The good news is that there are tax benefits to saving for a pension that make it an attractive way to invest money. 

If you are self-employed, and a basic rate taxpayer you will usually get a 25% tax top up. This means, as a basic rate taxpayer for every £100 you contribute to your pension, you’ll get another £25 from the government, making it £125. If you are a higher or additional rate taxpayer you can claim further tax relief through your Self Assessment tax return.

Saving into a pension if you have a limited company

If you have a limited company, any contributions you make to your pension through it could be treated as an allowable business expense, and may be offset against your corporation tax bill. It’s one of the few remaining tax perks of a limited company!

It’s worth noting that, while there’s no limit to the amount you can pay into your personal, self-employed or contractor pension, there are limits to the amount you can contribute and still receive tax relief. The limit is currently up to 100% of your salary or £60,000, whichever is lower. 

Your rights to your partner or spouse’s pension

But what if you aren’t working? Or not earning enough to save into a pension? What are your rights to your partner or spouse’s pension?

In a nutshell, here are your rights:

• If you are unmarried and you split, you have no legal right to your partner’s pensions.
• If your partner dies, the pension scheme will usually be paid out to their “nominated beneficiary” in line with their wishes. It is important to ensure these are kept up to date with the pension scheme administrator. 
• If you divorce, you can ask the court to split your spouse’s pension with you in a process called a Pension Sharing Order (PSO).

If you haven’t legally ensured you are protected in the event your partner or spouse dies or you split, it is important to address this. 

It’s also not unreasonable to start your own private pension from family funds if you are taking time away from work, or reducing your income potential, because you are caring for your children. It is important you build your own financial legacy as a mother.

You can read more about protecting your pension if you divorce here, and how to split your pension fairly here.

How much do you need to save for your retirement?

So now we know what income you may need for your desired retirement lifestyle, and what your pension options and tax benefits are, let’s put it all together and see how much you need to save. 

Obviously the earlier you start the better. But it may be that you haven’t yet got any or much saved for your pension. So let’s look at what you may need to save. 

• If you are single, are entitled to the full new State Pension, and want a moderate lifestyle, you may need an extra income of £19,800 a year. 
• If you are in a couple, are both entitled to the full new State Pension, and want a moderate lifestyle, you each may need a joint extra income of £20,100 a year.

How much do you need to save for an income of £20,000 a year? The following examples have been worked out using PensionBee’s pension calculator. They assume your employer will contribute £100 a month and you’ll retire at 70:

Obviously, the more you have saved up in your pension, the more you’re likely to be able to have as an income from it, although the value of your investment can go down as well as up, and you may get back less than you invest. Here’s a rough guide of what kind of income you could expect from different sized pension pots*:

• £285,000 could pay out up to £20,000 a year for 20 years
• £425,000 could pay out up to £30,000 a year for 20 years
• £575,000 could pay out up to £40,000 a year for 20 years

*Please note, the PensionBee calculator assumes investment growth of 5% every year, inflation of 2.5% and one annual management fee of 0.7%.

33% of women over 50 have no private pension

One of the reasons why we were inspired to write this article was the realisation that many women have no private pension yet. 

According to the 2023 Life Well Spent report, around 20% of men over 50, and 33% of women over 50 are relying on the State Pension alone to fund their retirement. And of these people, 92% are worried about money, and 85% are concerned about the rising cost of living.

A survey by SunLife also found that 18% of working homeowners aged over 50 had no private pension savings. 

If you’re in this number and are worrying you’ve left it too late to save for your retirement, please don’t panic – and definitely don’t do nothing as a result! 

Even if you start saving in your 40s or 50s, you can give yourself more financial options in retirement. And remember: for every £1 you put into a pension now, you may benefit from compound interest AND often, if you’re eligible, get employer or tax help to grow your savings.

An example of starting a pension in your 50s

Here’s an example of how you can start saving – and the benefits that gives you – even if you are relatively close to retirement age. 

Jo is 55 and plans to retire in 10 years, but hasn’t yet started a private pension. She’s self-employed and earns £30,000 a year. She decides to start a pension and pay in 7% of her gross income, which is £175 a month, deducted before tax.

If Jo continues this for 10 years and averages growth of 4%, that means she’ll have over £32,000 when she retires. However, she’s actually paid in just £21,000. (For comparison, in order to achieve the same performance, an ordinary investment fund would need to return a consistent 8% interest a year.)

If Jo opts for pension drawdown when she retires, she could take around £2,100 a year from it until she is 88. And remember: the pot still has the potential to grow during this time as the remainder of her pension pot is still invested. This means she may be able to withdraw around £49,000 in total, depending on market performance. All from a £21,000 investment, which means Jo has more than doubled her money. 

If you’re five or 10 years younger than Jo you have even longer to save up money, and to potentially benefit from interest-based growth. 

Pensions are a powerful, tax advantaged investment option – even if you start one late

As you can see, even though Jo started saving for her retirement late, thanks to the potential interest and tax benefits, she made her money work hard for her. So please, don’t think of pensions as ‘just another way of investing money’. They are actually a powerful, tax-advantaged investment option that may help you achieve your retirement plans.

So yes, while it’s wise to start a pension as early as you can, even if you have left it late, you may still benefit significantly from one. And if you haven’t left it late, you are in the fortunate position of being able to start saving now – and look forward to hopefully enjoying the retirement you want. 

Your pension action plan

So what should you do now? We wanted to leave you with clear steps to take after reading this article, so you can enjoy the retirement you want. 

Here’s your pension action plan:

• Check your State Pension: Are you on track to receive the full new State Pension? If not, can you afford to top it up?
• Check existing pension pots: Do you have any existing pension pots you may have forgotten about?
• Check other retirement income sources: Identify any other sources of retirement income, such as rental property.
• Check your partner’s pension savings: If you’re in a relationship, ask your partner or spouse about their pension.
• Ask them to make you a nominated beneficiary: If you and your partner decide that you should receive their pension if they die before you, ask them to add you as a nominated beneficiary.
• Check your wills: Do you and your partner both have up to date wills that financially protect the other? If not, write new ones.
• Decide what kind of retirement you want: Think about what kind of lifestyle you want when you retire, and how much that might cost. 
• Work out your ‘pension gap’: Calculate your shortfall after your State Pension income, existing pension pots, alternative income sources and your partner’s pension provision (if they have one).
• Decide when you want to/can afford to retire: Identify how many years you have left to save for retirement.
• Calculate how much you can afford: Look at your income and outgoings and work out how much you can contribute each month to a pension. Can you cut back on any expenses to save more?
• Start saving ASAP: Consideropening a pension and saving as soon as you can – remember, every month counts!

Risk warning: As always with investments, your capital is at risk. The value of your investment can rise or fall, and you could receive back less than you invest. This information should not be considered as financial advice.

About PensionBee

PensionBee can help you combine your old pension pots into one online plan that lets you keep track of your balance, make flexible contributions, invest in line with your values and make withdrawals from the age of 55. For more information, visit PensionBee.

Learn how long your pension could last with the PensionBee Pension Calculator.

Follow @PensionBee on X, Threads, Instagram, TikTok, Facebook and LinkedIn.

The post Everything you need to know about pensions – and how much you need to save for retirement  appeared first on Talented Ladies Club.

It’s not difficult to understand why people are nervous about trusting their financial futures to pensions if they remember Robert Maxwell. The disgraced media mogul famously looted money from the pension fund of the Mirror Group in an attempt to prop up his company share price.

In total, he was said to have stolen £460 million. And even with a partial government bailout and money from investment bankers who advised Maxwell, most of the people whose funds he plundered only received 50% of the value of their pensions.

So could this happen today? Thanks to the 1995 Pensions Act, no. As a result of the actions of Robert Maxwell, a review was conducted to look into ways that the running of pension schemes could be improved. Further changes were made in the 2014 Pensions Act.

So, how safe is it really if you were to entrust your future to a pension fund or workplace pension scheme? When weighing up the pros and cons of investing in a pension, the security of your money will absolutely feature. So, to help answer your pension questions, so we decided to look into the regulations surrounding pension safety for you.

The three different types of pensions

Before we examine how safe your pension may be, let’s quickly look at the three different types of pensions that are available.

1) A private pension

A private pension is a plan into which you privately contribute from your earnings, which then will pay you a pension after you retire. 

2) A SIPP

A self-invested personal pension (SIPP) is a UK government-approved personal pension scheme that allows you to make your own investment decisions from the full range of investments approved by HMRC.

3) A workplace pension

A workplace pension is a way of saving for your retirement that’s set up by your employer. A percentage of your pay is paid into the scheme automatically every payday. Your employer usually contributes money to the scheme for you too. 

How safe is your pension?

So how safe is your pension? The first thing you need to know is that the Financial Services Compensation Scheme (FSCS) protects you for up to £85,000 per person, per institute. So straight away, a significant sum of your pension is protected.

There’s more reassurance too. If your pension provider is has been authorised by the Financial Conduct Authority (FCA), it is covered in the following way:

• If you have a private pension and it fails, the FSCS will cover 100% of your claim with no upper limit.
• If you have a SIPP and your operator fails, you are protected by up to £85k per person, per institute.
• If you have received bad pension advice, you can claim compensation up to £85k per eligible person, per firm.

However it is important to note that, while the FSCS does offer protection, it doesn’t cover performance losses. So if you invest in shares that fail, you can’t claim compensation. But if you think you have received poor investment management, then you may have a claim.

How safe is your workplace pension?

There are also rules regulating workplace pensions. These rules ensure that your workplace pension is protected, whether the provider is your employer or a financial company.

Exactly how your pension is protected depends on which of the two types of scheme it is:

• Defined contribution pension scheme – this means your employer chooses a pension provider to invest your pension contributions.
• Defined benefit pension scheme – these schemes promise to pay you a certain amount each year when you retire.

How are you protected on a defined contribution pension scheme?

If you’re on a defined contribution scheme a pension provider usually looks after your pension fund. So even if your employer goes bust, you won’t lose your pension fund.

If your pension provider cannot pay your pension but they were authorised by the FCA, you can get compensation from the FSCS. As outlined previously, this could be 100% of your claim with no upper limit.

How are you protected on a defined benefit pension scheme?

Your employer needs to ensure their scheme has enough money to pay your pension. And they aren’t able to spend the pension fund if they have financial problems.

If your employer goes out of business and can’t pay your pension, you are usually protected by the Pension Protection Fund (PPF). The PPF usually pays:

• 100% compensation if you’ve reached the scheme’s pension age
• 90% compensation if you’re below the scheme’s pension age

What happens if you experience pension fraud, theft or bad management?

If there is a shortfall in your workplace pension fund and that has been caused by fraud or theft, the Pension Protection Fund may be able to recover some money.

What happens if your employer’s business is taken over?

If your employer’s business is bought out or merged with another company and you decide to stay, your new employer must:

• Give you access to a replacement pension
• Tell you about the new pension scheme
• Automatically enrol you in it if you’re eligible

Do you have a pension yet?

If you haven’t yet started saving for your retirement, you may want to look into your pension options.

Risk warning: As always with investments, your capital is at risk. The value of your investment can rise or fall, and you could receive back less than you invest. This information should not be considered as financial advice.

The post How safe is your pension? appeared first on Talented Ladies Club.

And, according to Retirement Living Standards, that’s not enough.

But what IS enough? How much do you need for retirement, and what’s the best way to save up for it?

That’s exactly what we will explore in a free webinar in partnership with PensionBee, featuring two financial experts:

• Becky O’Connor, Director (VP) Public Affairs for PensionBee and the Telegraph’s ‘Pensions Doctor’.
• Emma Maslin, Founder of multi award-winning personal finance education website The Money Whisperer and popular media financial expert.

The webinar takes place at 12:30 pm on Tuesday 19 March, and you can book your free place here. In it, we’ll take you through a process in which you will:

• Think about what kind of retirement you want 
• Work out how much this might cost to fund 
• Find out how much you could currently get
• Identify the financial gap you may need to fill 
• Start planning a strategy to help fill that gap

Our aim throughout this discussion is to demystify pensions and to leave you feeling empowered and ready to take positive action.

We’ll even share an example of how you can start saving towards a pension if you are in your 50s. You’ll also get a pension worksheet to help you devise an action plan, plus the chance to ask questions.

This is a must-watch session for anyone who doesn’t yet have a pension plan, and wants to understand what they can do now.

Can’t join us live? Book your place anyway and we will send you a recording afterwards so you can watch it in your own time.

PensionBee can help you combine your old pension pots into one online plan that lets you keep track of your balance, make flexible contributions, invest in line with your values and make withdrawals from the age of 55. For more information, visit PensionBee.com. Capital at risk.

The post Free webinar: How to save up for the retirement you want appeared first on Talented Ladies Club.

Yet, with the right strategies and a bit of savvy planning, it’s entirely possible to lay the groundwork for future prosperity without sacrificing precious moments with your children.

This article explores actionable steps that mothers can take to secure their family’s financial future, including a strategic look at investment opportunities like real estate.

Prioritize your financial goals

Understanding and prioritizing your financial goals is the first step toward building a lasting legacy. Start by defining what financial security means to you and your family, whether it’s owning a home outright, funding a college education, or ensuring a comfortable retirement.

Break these goals down into short-term, medium-term, and long-term objectives, and create a realistic plan to achieve them. Remember, the key is consistency and persistence; even small contributions can grow significantly over time thanks to the power of compound interest.

Create a budget that works

A well-thought-out budget is your best tool for balancing financial obligations and savings goals. Track your income and expenses to identify areas where you can cut back and redirect funds toward savings or investments.

To ensure these priorities are not overlooked, incorporate budget lines for emergency funds, retirement savings, and college funds. Automation can be a great ally here, with automatic transfers ensuring you’re consistently saving without having to think about it every month.

Embrace the power of savings

Savings accounts are not one-size-fits-all. Choosing the right type can significantly impact your financial health and growth potential. Here’s a look at various savings accounts and what they offer:

• Traditional Savings Accounts: Offered by banks and credit unions, these accounts provide a safe place to store your money while earning interest. They’re highly liquid, meaning you can access your money easily. However, they typically offer lower interest rates compared to other savings options.
• High-Yield Savings Accounts: Similar to traditional savings accounts but with a higher interest rate, high-yield savings accounts are an excellent option for earning more on your stored funds. They’re usually found at online banks, which have lower overhead costs and can offer better rates.
• Money Market Accounts (MMAs): MMAs combine features of savings and checking accounts, offering higher interest rates like a savings account, but with the ability to write checks or use a debit card. They may require higher minimum balances but are a good option for those looking for flexibility with a higher yield.
• Individual Development Accounts (IDAs): These are matched savings accounts designed to help low-income individuals save towards specific goals, such as buying a home, funding education, or starting a business. Contributions are matched by private or public funds, effectively doubling your savings.
• Health Savings Accounts (HSAs): For those with high-deductible health plans, HSAs offer a tax-advantaged way to save and pay for medical expenses. Contributions are tax-deductible, the money grows tax-free, and withdrawals for qualified medical expenses are not taxed.
• Education Savings Accounts (ESAs) or 529 Plans: These are tax-advantaged accounts designed to save for education expenses. While 529 Plans can be used for tuition, room, board, and other education-related expenses at any level, ESAs also offer the flexibility to cover K-12 expenses.

Each type of savings account offers unique advantages, whether it’s higher interest rates, tax benefits, or matching contributions. By understanding your financial goals and the features of each account, you can strategically choose where to allocate your savings to maximize growth and meet your financial objectives.

Understand investment strategies

Diversifying your investments is akin to spreading seeds across various soil types; some will flourish more than others, but collectively they yield a bountiful harvest. Here’s a breakdown of different investment types to consider:

• Stocks: Buying shares in companies offers you a piece of ownership. While stocks are known for their volatility, they also provide significant potential for long-term growth. Diversify across sectors to mitigate risk.
• Bonds: These are essentially loans you give to corporations or governments in return for periodic interest payments and the return of the bond’s face value at maturity. Bonds are typically less risky than stocks and can provide steady income, making them an essential part of a balanced portfolio.
• Mutual Funds: Managed by professionals, mutual funds pool money from many investors to buy a diversified portfolio of stocks, bonds, or other securities. They offer diversification and professional management but come with management fees.
• Exchange-Traded Funds (ETFs): Like mutual funds, ETFs offer a way to invest in a diversified portfolio, but they trade on stock exchanges similar to individual stocks. They often have lower fees than mutual funds and provide an easy way to diversify your investments.
• Real Estate: Direct investment in property can require significant capital and involves managing the property. Syndication is also an option, where you pool resources with other investors to buy into larger real estate investments. This can offer passive income and capital appreciation with less hands-on management.
• Certificates of Deposit (CDs): Issued by banks, CDs offer a fixed interest rate over a specified term. They’re a low-risk investment but lock up your money for the duration of the term, with penalties for early withdrawal.

Each investment type offers a unique blend of risk, return, and liquidity, making it important to choose investments that align with your financial goals, timeline, and risk tolerance. By understanding and leveraging these diverse investment strategies, including innovative options like real estate syndication, you can build a robust portfolio that grows with you and your family, paving the way for a secure financial legacy.

Plan for retirement

Planning for retirement is a crucial aspect of financial security, offering peace of mind for your future. Here are three retirement plans that can help you build a substantial nest egg.

1) 401(k) Plans

Offered by many employers, 401(k) plans allow employees to save and invest a portion of their paycheck before taxes are taken out. Taxes aren’t paid until the money is withdrawn from the account, typically after retirement, potentially lowering your tax liability while you’re working.

Many employers offer a matching contribution up to a certain percentage, which can significantly boost your savings. There are also Roth 401(k) options, where contributions are made with after-tax dollars, allowing for tax-free withdrawals in retirement.

2) Individual Retirement Accounts (IRAs)

IRAs are tax-advantaged retirement savings accounts that individuals can open independently of their workplace. Traditional IRAs offer tax-deferred growth, meaning you pay taxes on your investments when you withdraw in retirement.

Contributions may be tax-deductible depending on your income and other factors. On the other hand, Roth IRAs are funded with after-tax dollars, allowing your investments to grow tax-free, with tax-free withdrawals in retirement, provided certain conditions are met.

3) Simplified Employee Pension (SEP) IRAs

Designed for self-employed individuals and small business owners, SEP IRAs allow for larger contributions than traditional or Roth IRAs. The employer makes contributions to the employee’s SEP IRA account and are tax-deductible as a business expense.

Employees do not pay taxes on SEP IRA contributions, but distributions in retirement are taxed as income. SEP IRAs offer a straightforward way for small businesses and freelancers to save for retirement with the added benefit of reducing current taxable income.

Each of these retirement plans has its unique features, benefits, and contribution limits, making it important to choose the one that best fits your financial situation and retirement goals. By starting early and contributing regularly, you can take advantage of compound interest and tax benefits to build a substantial retirement fund, ensuring financial security in your later years.

Protect your legacy with insurance

Insurance is a critical tool in protecting your financial legacy. Life insurance can provide your family with financial stability in the event of your untimely death, while disability insurance protects your income should you become unable to work. Consider the needs of your family and the role your income plays in their financial security when choosing insurance products, ensuring that you’re adequately covered for any eventuality.

Educate your children about finances

Building a financial legacy isn’t just about amassing wealth; it’s also about passing on the knowledge and values to help your children manage and grow that wealth. Teach your children about budgeting, saving, and investing from a young age. Encourage open discussions about money, including the principles behind your family’s financial decisions, to instill a sense of financial responsibility and acumen.

Lay the foundation of a lasting legacy

Navigating motherhood while building a financial legacy is no small feat, yet it’s undeniably rewarding. By setting clear financial goals, creating and sticking to a budget, saving diligently, understanding the landscape of investment opportunities – including avenues like real estate syndication – planning for retirement, securing your legacy with insurance, and educating your children about finances, you can create a robust financial future for your family.

Remember, the legacy you build today is the foundation upon which your children and future generations will stand. Let your legacy be one of financial stability, wisdom, and prosperity, setting the stage for continued success long after you’re gone.

The post Balancing act: Navigating motherhood and building a financial legacy appeared first on Talented Ladies Club.

But what can often get left behind in those busy years is financial planning, especially when it comes to the parent who stays at home. And, despite the introduction of Shared Parental Leave, eight out of nine stay-at-home parents are mothers. 

This means that women are often at a disadvantage when it comes to financial freedom and long term financial security – as we see in the Gender Pension Gap.

We don’t think that is right or fair. So we have decided to put together a helpful guide on the most important financial areas mums need to think about. 

If you are a mum already, or are planning to start a family, please do read this guide and take any actions you need. Don’t rely on someone else to take care of you financially, or hope that things will ‘just work out’ somehow. You have financial responsibility for yourself – and it feels good when you are making informed choices and taking positive action for yourself! 

Three important things every mum needs to know about money

Money management (and financial protection) is simpler than you think when you know your rights. And to help you, in this guide we’re going to look at three important financial and legal areas for mums:

1. Maternity leave and pay (whether you are employed, self-employed or not working)
2. Saving for a pension as a mum – how much you need and how to find the money
3. Your entitlements to your spouse or partner’s pension if you divorce or they die

1) Your maternity leave entitlements

When you have a baby in the UK you are usually entitled to take paid time off work. How much time, and how much pay you will receive depends on a few factors. 

Let’s look at your maternity leave and pay entitlements if you are:

• Employed
• Self-employed
• Not currently in paid work

What are your maternity leave entitlements if you are employed?

If you are employed, you are entitled to Statutory Maternity Leave of 52 weeks. This consists of:

• 26 weeks of Ordinary Maternity Leave 
• An extra 26 weeks of Additional Maternity Leave

You do not need to take this leave if you do not wish to. However, you must legally take two weeks of leave after your baby is born, and four weeks leave if you work in a factory. 

You may also be entitled to contractual maternity pay as part of your employment package. You will need to refer to your contract and/or company maternity policy to check this.

It is important to note that you have a number of rights while on Statutory Maternity Leave. These include:

• You can ask for flexible working arrangements for when you you return to work 
• Your employment terms, such as your pension contributions are protected 
• You have extra rights if you are made redundant

If you are an agency worker, you can check your maternity rights here.

How much is Statutory Maternity Pay?

While you are on Statutory Maternity Leave you are entitled to up to 39 weeks of Statutory Maternity Pay (SMP):

• For the first six weeks you are paid 90% of your average weekly earnings before tax
• For the next 33 weeks you are paid £172.48 or 90% of your average weekly earnings (whichever is lower).

In order to receive SMP you need to provide your employer with either a letter from your doctor or midwife, or your MATB1 certificate within 21 days of your maternity leave start date. 

When you receive SMP, it is paid in the same way as your wages (for example, monthly or weekly) and tax and National Insurance are deducted.

If you believe your employer isn’t paying you the right amount of SMP or is incorrectly refusing to pay, you should contact HMRC.

What are your maternity leave entitlements if you are self-employed?

If you are self-employed you have no entitlement to maternity leave. However, you can claim Maternity Allowance, which is paid for up to 39 weeks so you can take time off work.

You can claim for Maternity Allowance once you are 26 weeks’ pregnant and receive payments from up to 11 weeks before your baby’s due date. 

To claim Maternity Allowance you will need to complete a Maternity Allowance (M1) claim form. 

How much is Maternity Allowance?

Your amount of Maternity Allowance will depend on how many Class 2 National Insurance contributions you’ve made in the 66 weeks before your baby is due.

In order to receive £172.48 a week for the full 39 weeks you need to:

• Have been registered with HMRC for at least 26 weeks in the 66 weeks before your baby is due
• Have paid Class 2 National Insurance contributions for at least 13 of the 66 weeks before your baby is due.

If you’ve not paid any Class 2 National Insurance contributions, you will only be entitled to £27 a week Maternity Allowance.

Maternity Allowance is usually paid every two or four weeks straight into your bank, building society or credit union account.

What happens if you haven’t paid enough National Insurance? 

If you’ve paid less than 13 weeks of Class 2 National Insurance, HMRC will contact you after you apply for Maternity Allowance and give you the option to top up your contributions to increase your Maternity Allowance. They’ll tell you how many extra contributions you need to get the full amount. (Class 2 National Insurance contributions are £3.45 a week for the 2023/34 tax year.)

Once your extra contributions are linked to your Maternity Allowance application, your payments will be increased and backdated if needed. Though please beware this can take several weeks.

What are your maternity pay entitlements if you are not working?

What if you aren’t working or self-employed? Are you entitled to any maternity pay? 

If you work unpaid for your spouse or civil partner’s business, you will receive a Maternity Allowance of £27 a week for up to 14 weeks. 

And if you are employed or have recently stopped working you can get Maternity Allowance of £172.48 a week or 90% of your average weekly earnings (whichever is lower) for up to 39 weeks.

As before, to claim Maternity Allowance you need to complete a Maternity Allowance (M1) claim form. 

If you aren’t eligible to receive any form of maternity pay, you may be eligible for Universal Credit or Employment and Support Allowance. Check to see what benefits you may be entitled to here.  

2) Saving for a pension as a mum

You’ve probably heard about the gender pay gap. But fewer people are aware of the Gender Pensions Gap. This is the percentage difference in pension income between men and women. And, according to the latest data from the government, the Gender Pension Gap for private pensions, currently stands at 35%.

So why does the Gender Pension Gap exist? There are a few reasons women have a much smaller pension pot than men. Here are some of the most common:

• We earn less on average
• We take more time off for childcare and other caring duties
• More of us work part time

To help ensure you have enough to live on when you retire if you are a mum, we’re going to explore both your State Pension entitlement and saving for a private pension.

Learn more about the Gender Pension Gap in episode three of The Pension Confident Podcast.

Your State Pension entitlement

To get any form of State Pension you will need at least 10 qualifying years on your National Insurance (NI) record (these years do not need to be in a row). During these 10 years one or more of the following would need to apply:

• You were working and paying NI contributions
• You were getting getting NI credits
• You were paying voluntary NI contributions

It is important to remember that even if you are away from the workplace, your years as a stay-at-home parent still qualify towards your state pension through NI credits.

If you are registered for child benefit and your youngest child is under 12, you will get National Insurance (NI) credits for the time you spend at home.

To qualify for the full State Pension, you will need a total of 35 years of NI contributions or credits by the time you retire. To find out how much State Pension you are entitled to you can check here. And you can check your National Insurance record for gaps here.

The full State Pension is currently £203.85 a week (£10,600.20 a year) for tax year 2023/24 but is set to rise in April by 8.5% in line with the ‘triple lock’ agreement. The current age at which you can claim it is 66. This will rise to 67 by the end of 2028. 

If you want to increase your State Pension and you can wait before claiming it, you can choose to defer it. If you defer your State Pension for more than nine weeks, it will rise each week. The rise is equivalent to:

• 1% for every nine weeks you defer
• 5.8% for every 52 weeks you defer

So if you defer for one year, you will get an extra £11.82 a week (£614.64 a year).

Saving for a private pension as a mum

Research shows that 21% of adults in the UK have no private pension, and just 16% of self-employed people are saving into theirs. 

If, like many people, you are relying solely on the State Pension for your retirement income (and you’re entitled to the full amount) it means you’ll be living on just £10,600.20 a year. But is this enough?

According to Retirement Living Standards, if you are single when you retire, you would need:

• £14,400 a year for a minimum lifestyle
• £31,300 a year for a moderate lifestyle
• £43,100 a year for a comfortable lifestyle

And a couple would need: 

• £22,400 a year for a minimum lifestyle
• £43,100 a year for a moderate lifestyle
• £59,000 a year for a comfortable lifestyle

To give you an idea of how much you’d need to save up for your pension, here’s what different sizes of pension pots could pay out per year for 20 years:

• £285,000 could pay out up to £20,000 a year
• £425,000 could pay out up to £30,000 a year 
• £575,000 could pay out up to £40,000 a year

(You can check how much income your pension could generate using this Pension Calculator.)

To plug the gap, you may decide to start your own private pension or top up an existing plan that you may have paid into previously. 

How to save for a pension as a mum

Even investing a tiny amount every month now will make a difference to the kind of lifestyle you can afford when you retire. So how can you find the money to put into a pension if you are a stay-at-home mum, or working part time around your children? 

Firstly, it’s also worth checking that you don’t already have a pension pot you have forgotten about. You can check here. And don’t forget about tax relief. If you pay tax, you could also get tax relief on your pension contributions. These effectively mean that the government adds money to your pension pot. 

So, if you are self-employed, and a basic rate taxpayer you get a 25% tax top up; for every £100 you contribute to your pension, you’ll get another £25 from the government, making it £125. If you are a higher or additional rate taxpayer you can claim further tax relief through your Self Assessment tax return.

Although there’s no limit to the amount you can pay into your personal, self-employed or contractor pension, there are limits to the amount you can contribute and still receive tax relief. The limit is currently 100% of your income, up to a maximum of £60,000.(You can read more about pension top-ups here when you are self-employed here.)

If you have a limited company, any contributions you make to your pension through it could be treated as an allowable business expense, and may be offset against your corporation tax bill.

If you work – even part time – for an employer and are at least 22 years old, have not reached State Pension age, earn more than £10,000 a year, and are not already a member of a suitable workplace scheme, by law your employer must offer you a workplace pension scheme and contribute towards it. 

If you earn less than £10,000, but above £6,240, your employer doesn’t have to automatically enrol you in their scheme. However, if you ask to join, your employer will be unable to refuse you and must make contributions on your behalf. You can read more information on the safety of workplace pensions here, and the pros and cons of pension plans here.

3) Your rights to your partner’s pension if you split up (or they die)

If you aren’t working at all, or you are working full time around your family, you may be relying on your partner or spouse’s pension for your future financial security. But what happens if you split up? 

If you get divorced from your spouse, you can ask the court to split their pension with you in a process called a Pension Sharing Order (PSO). With a PSO you will be able to take a share of their pension immediately. You may also be able to join their pension scheme or move it to your own pension.

Or you may decide to ask for a pension attachment or earmarking order. This redirects some or all of their pension benefits to you when they start withdrawing.

In recent years, the increase in DIY divorces have meant that more people have overlooked pensions when dividing up money and property. So please do seek legal advice regarding what you may be entitled to and how best to secure it as part of your settlement. 

But what if you aren’t married? Unfortunately, as part of a cohabiting couple you can make no claims on your ex-partner’s pensions if you split. 

So if you are raising children with a partner and you have made a family decision for you to stay at home while your partner works, or for you to work part time or around the children, it is important to protect yourself financially by starting your own private pension. It’s not unreasonable to make contributions to this from the family income. 

You also don’t have an automatic right to benefit from your partner’s private pensions if they were to die, but it will usually be paid to you if you are named formally as a ‘nominated beneficiary’.

If your unmarried partner dies, you would not benefit from their estate either. If you wished to make a claim against their estate, you could do so under the Inheritance (Provision for Family and Dependants) Act 1975. You would need to have been either ‘living as husband and wife’ for a period of two years before their death, or you must have been ‘maintained by’ or financially ‘dependent on’ your partner, and they must have made no proper provision for you.

This demonstrates why having an up-to-date will is so important. If you or your partner don’t already have one, it’s wise to make one as soon as possible. And if your partner has not yet done so, ask them to nominate you as a beneficiary on their pension.

You can read more information on how to protect your pension in a divorce here, and how to split your pension fairly here.

What to do now

So what can you do now to protect yourself financially, and ensure you are getting everything you are entitled to financially as a mum? Here are our quick, take-away tips for each section.

Our maternity leave tips: 

• If you are currently on maternity leave, pregnant or planning for a baby, make sure you are receiving the leave and pay you are entitled to. 
• If you need to, look into topping up your National Insurance contributions to receive your full Maternity Allowance. 

Our pension tips:

• Check your entitlement to the full State Pension and consider topping up if you need. 
• If you don’t already have a private pension that will plug the gap left between the State Pension and the income you will need for the lifestyle you want when you retire, consider starting one now.
• Look for ways you can reduce outgoings to put away enough money each month. Or ask your working partner to help you with the money you need to pay into your own pension. 

Our splitting up/bereavement tips:

• If you are getting divorced, make sure your ex-spouse’s pension is taken into account when dividing up money and property. 
• If you are not married, ensure you are protected by asking your partner to make you a nominated beneficiary of their pension, by ensuring you both have up-to-date wills, and by starting your own private pension. 

Risk warning: As always with investments, your capital is at risk. The value of your investment can rise or fall, and you could receive back less than you invest. This information should not be considered as financial advice.

About PensionBee

PensionBee can help you combine your old pension pots into one online plan that lets you keep track of your balance, make flexible contributions, invest in line with your values and make withdrawals from the age of 55. For more information, visit PensionBee.

Learn how long your pension could last with the PensionBee Pension Calculator.

Follow @PensionBee on X, Threads, Instagram, TikTok, Facebook and LinkedIn.

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