How do pensions work?

The first thing to remember is that if you arecontribution too, helping to build you a greater pot
working and paying National Insurance, then you willfor your retirement.
be eligible for a basic state pension.The money that you pay into your pension will not
However, a basic state pension is often not enoughbe taxed, but instead it is put into in stocks, shares
to give you the standard of living that you want.  and other investments, which enables the pot to
The stats for 09/10 state that if you are a singlegrow.
person then you can expect to receive £95.25 aWhen you decide to retire, your pension fund will be
week, which equates to £4,572 a year.  A coupleconverted into an income that you will receive until
will receive £152.30 a week or £7,310.04 a year -the day that you die.
so is that enough?It is worth knowing that you don't have to stop
Although a basic state pension will give you a solidworking to start receiving from your stakeholder or
foundation it is also worth considering another sourcepersonal pension.  In some cases you can even
of income for when you finish working.continue working for your employer whilst taking
There are other types of pension that you can haveyour pension.
running alongside your basic state pension and givenWhat is important to consider is that you could be
that the government aren't being overly generous, itretired for as long as 30 years.  With this in mind,
is definitely something to consider.you need to make sure that you are provided for as
Your employer might offer a pension scheme or ifyour pension will become your income.
this is not an option, then you can start your own.The longer that you have a scheme for, the better
A pension is a long term investment that you payoff you will be, although you cannot take money
into up until the time that you retire.  If you have afrom your pension until you are 55.  Knowing the
company pension, then your employer will make abasics will help you to save for a better future.