There are several benefits to having a pension:
- Retirement Income: A pension provides a regular income during retirement, supplementing the state pension or other sources of income.
- Tax Advantages: Contributions to pensions usually receive income tax relief, meaning you receive tax benefits on the money you contribute. Additionally, pension growth is generally tax-free or tax-deferred until you start withdrawing funds.
- Investment Growth: Pensions allow you to invest your contributions in assets like equities, property and bonds, potentially generating growth over the long term. This can help your savings accumulate and keep pace with inflation.
- Financial Security: A pension provides a financial safety net in retirement, helping you maintain your standard of living and cover expenses when you’re no longer working.
