When Can You Claim Your Pension?
A large factor in whether you can actually depend on your pension relies on when you gain access to it. For those who have not reached state pension age, you won’t be able to rely on a pension because you will still be required to look for work.
In the past, once you reached the state pension age of 60 as a woman and 65 as a man, you were be able to start receiving a pension credit to top up your income without having to look for work.

But now, the state pension age is changing. If you are a woman born on or after 6 April 1950, or a man born on or after 6 April 1959, your state pension age adjusts based on your year of birth. So those born after this date might have to wait until they’re as old as 68 to claim their pension.

Will My Pension Last?
Whether or not you can depend on your pension also has a lot to do with whether it will actually last throughout your retirement. If you have access to full weekly rates (single person: £97.65, married couple: £195.30) then it may actually be something you can depend on.
But whether or not you actually receive the full pension depends on whether you’ve fulfilled the National Insurance (NI) contribution requirements. Also, it depends on how many “qualifying years” you have worked. If you have not worked 30 qualifying years then you won’t receive the full pension.
Knowing whether you can depend on your pension has a lot to do with whether you actually qualify for it based on years worked, age and NI contributions. So take time to explore this information so that you can take the steps to have the most dependable retirement pension possible.

This was a guest post by GoInsuranceRates.com, a site that provides daily updates on the latest auto insurance rates, finance information and more.

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So first of all what is a stakeholder pension? Well it is not a new kind of pension so to speak, but it is a personal pension which has a set of conditions under which it must operate in order to be called a stakeholder pension. It is not limited to being a personal pension as it can also be a set of conditions which applies to a money purchase occupational scheme.

The purpose of the set of conditions is to make the pension simple, easy and good value for money. So what are the set of conditions that apply to stakeholder pensions then? Well here are the minimum standards that apply to it:

1. The charges must be low at around 1% of the fund invested each year.

2. It must be designed to be simple which is done by having a standard investment option so that you do not have to choose the investments yourself.

3. It must be portable, meaning that you can transfer the stakeholder pension on to a different pension which can be another stakeholder pension or another personal pension. Also if you do this you would not be penalised for transferring it.

4. The pension provider must keep you informed of any changes in the charges you have to pay for it by letting you know one month before the changes take place. They must also send you a statement at least once a year so you are kept up to date with your account.

5. The minimum contribution must be 20 and you must not be obliged to pay in every month unless you wish to do so.

So what are the advantages of a stakeholder pension? The main advantages are that it has low charges, that it has tax advantages, that they are easy to understand and relatively simple, are generally speaking good value for money and that you can transfer it to another pension without incurring any fees.

Are there any disadvantages to it? Well the main disadvantages are that the pension amount you will receive in the future is not predictable, that there is an investment risk and that there is no guarantee that your stakeholder pension will keep pace with price inflation.

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401k plans differ greatly depending on the employer who sets the rules. The only way to get the most out of the plan is to get to know it and make educated choices.

Things you should know:

- What is the maximum percentage of your salary you are able to contribute?
- Is your employer matching the contributions? If yes, what is your minimum contribution, before your employers contribution starts, and what is the maximum?
- What are the number of years you have to be with the company (so called vesting) to be eligible for the employers contributions to your 401k?
- How often can you switch among available investment options?
- Are earnings posted to your account on a weekly, monthly or quarterly basis? When do you get your account statements? Note, it is always more beneficial if earnings are added to your balance more often.
- What methods can you use to access the account? By phone, on the internet or only in writing?
- Did you spread your money among different investments to reduce the risk?
- Did you learn enough about the investments you are using?

Do you know that 401k plans are not insured by the federal government, and its investments are at risk? However, different investments carry different degrees of risk. It is always best to diversify your investments by investing in different types of assets. To find out more about 401k investment options, ask your plan administrator for information. Financial magazines, prospectus and brochures can be a good source for learning about particular investment options.

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You should contribute as much as you can to your 401(k). Don’t overextend yourself, but you don’t want to waste the opportunity to deposit tax free, tax deferred money and have it matched. The amount the company matches you for is free money. Don’t let it go.

In 2005, the maximum before tax annual contribution that an employee can make is $14,000. If the employee is over 50 years of age, he or she can contribute $16,000. The limit is set to increase by $1,000 in 2006.

Your 401(k) is simply an account; you chose the investments within the account. There is usually an array of mutual funds presented to you, but you must decide the allocations. There is no one to advice you when it comes to role fees and expenses that will affect your overall returns.

First, decide how much risk you are willing to assume. How much volatility within the portfolio can you stand?

If you are in your 20’s and early 30’s you have the time to be aggressive with your investments. The time factor allows you to recover from slumps in the stock market. As you age, your investments should become more conservative to protect your earnings.

Many 401(k) plans have tools, such as online calculators and worksheets, which help you in determining how much risk you should accept. The best tool is often to seek the advice of a competent financial planner. It is worth it to hire a planner to evaluate your assets and earning ability if the end result is a comfortable retirement.

If you find that you are in need of money, most plans will allow you to borrow up to 50% of your vested balance, but not over $50,000. You usually have to repay the money with interest within five years. The interest payments go into your account, so you are paying yourself the interest. There are downsides, though.

The money you have withdrawn as a loan isn’t appreciating. The original contributions were made with pre-tax dollars, but the money you payback is after-tax. If you don’t pay back the money it will be considered a normal distribution, and taxed and penalized.

If you leave the company, in most cases you will want to take your 401(k) with you. You can role it over into another company’s 401(k) plan program or into your own IRA at a brokerage. With an IRA, you will have more control over your account, and better investment options.

Whatever you do with your IRA, make sure that you follow all procedures to the point. You don’t want to accidentally withdraw your money and have to pay the taxes and penalties. This is a very costly mistake.

If you are an entrepreneur, you can open an individual 401(k). This gives you the option of investing thousands of dollars more than in other kinds of self-employment retirement accounts. An individual, or solo, 401(k) is available to businesses that only have the owner and spouse as employees. This means that if you work for someone else and have a business on the side, you can open an individual 401(k).

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