The universal truth is the earlier you plan, the wealthier you will be in retirement.

In the modern world, the responsibility of planning for your retirement is yours and yours alone. When you are younger, you will need to consider which retirement saving options are right for you. Then, as retirement looms, your thoughts should turn to what is best for your pension fund. What you need is a plan, and someone to help you make those decisions. This is where AJ Wealth Management can help.

Self Invested Personal Pension

A pension is one of the most tax-efficient ways of saving for retirement. Like all pensions a SIPP offers up to 45% tax relief on contributions and there is no capital gains tax or further income tax to pay. Whereas traditional pensions typically limit investment choice, a SIPP allows you the maximum choice of investments.

When you make a pension contribution, 20% basic rate tax relief is automatically added by the government. For instance if you invest £8,000, the government adds £2,000 tax relief, increasing your total contribution to £10,000. If you pay tax at 40% or 45%, you can claim back even more through your tax return.

If you’re a UK resident under the age of 75, the general rule is you can contribute to all your pensions as much as you earn and receive tax relief each tax year.


Drawdown gives you an income and the flexibility to use your pension savings in a way that best suits your individual needs now and in the future. From age 55, you can take up to 25% tax free cash from your SIPP and a taxable income from the remainder of the funds. You can adapt how much income you take to suit your changing circumstances at any time.

The remaining funds will stay invested and could benefit from potential tax-efficient growth.

On the event of your death, you can pass on your remaining pot to anyone you choose, inheritance tax free. After April 2015 if you die before age 75, this will be completely tax free. If you die after the age 75, they will be able to access the pension flexibly, at any age, subject to tax.

Once going into drawdown you still have the option of purchasing an annuity (fixed income for life) at any time.


Fixed Income is a guaranteed, regular income that will last for the rest of your life. A fixed income can offer some financial security for life.

You can build in options to help you find a retirement solution that’s right you. For example by choosing a fixed income that moves in line with inflation you can ensure that your money stays in line with the rising prices of goods, giving you a better chance of a comfortable retirement.