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| pensions in the united kingdom | |
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Although many stakeholder pensions have been taken out, they have largely not been successful in encouraging lower earners to save more. The government announced in May 2006 that it proposed to introduce a new pension scheme called Personal Accounts . It seems likely that personal accounts will take over the intended role of stakeholder pension schemes. CONDITIONS All stakeholder pension schemes must be registered with The Pensions Regulator. Like personal pension schemes - stakeholder pensions must provide an income in retirement using a minimum of 75% of the fund. Up to 25% of the fund can be taken as a tax free lump sum. Originally the maximum annual charge was 1% of the fund value each year. Since 2005 this has increased to 1.5% of the fund value for each year until the 10th year and 1% thereafter. There can be no penalty on exit or entrance to the scheme, and the minimum contribution is £20 per month. However, payments can be stopped at any time and a single contribution of £20 is enough to open a plan. Benefits can be taken from age 50 (under current rules) and must be taken by age 75. Income can be provided via a Secured Pension (annuity), Unsecured Pension (income withdrawal/drawdown) or from age 75 an Alternatively Secured Pension . SEE ALSO EXTERNAL LINKS |
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