The 55 Plan

One of our most popular areas of financial planning is around future income planning, or what we like to call your 55 Plan. Although the government has encouraged employers to help with Auto-Enrolment Workplace Pension Schemes, we feel that a lot more can be done to ensure our clients achieve the later lifestyle they deserve.

Would having access to a significant amount of money when you reach 55 make things a little easier? We use 55 as a target age as that's the earliest you can access personal pension plans and gives our clients something to aim towards.

We are passionate about helping people in their 20's to 40's achieve this through simple tax-efficient savings and investment planning. This gives you maximum opportunity for growth while still having access to some of your money in an emergency. 

When is the best time to start saving for my 55 Plan?

We understand that your personal situation can dictate the amount you are able to set aside each month. With this in mind, we recommend starting as early as you can and simply adjust the amount you contribute in-line with changes in your circumstances.

Whether you have recently left home and started work-life or have a family and an established career, now is the time to start getting serious and plan ahead.

Putting the necessary plans in place now will simply give you more choices, greater financial freedom and enhanced peace of mind.

How the 55 Plan Works

In simple terms, it's all about investing as much money as you can afford each month over the long-term so that you can maximise growth potential and build up a significant fund of money, accessible from 55+. You can still access some of this money at any time you need to.

1 | Utilise 20-40% tax-breaks from a personal pension (dependent on your tax bracket)

2 | Enjoy tax-free growth and flexible access of an investment ISA

3 | Combine it with long-term compound interest

The investment risk and subsequent growth potential can be tailored and monitored to your personal attitude to risk and capacity for loss profile and reviewed on an annual basis.

As we are Independent Financial Advisors, we have access to the whole market and can choose cost-effective providers that suit your requirements. We will discuss and agree on an affordable contribution amount that can be made flexibly on a monthly standing order basis, and/or as one-off lump sum payments within each tax year to utilise your allowance.

Currently, you can receive tax relief on contributions up to £40,000 per year into your personal pension. You can enjoy tax-free growth on £20,000 of contributions paid into your personal investment ISA.

When you reach 55 you will have various choices which could include:

Taking up to 25% of the pension fund as a tax-free lump sum

Start taking a flexible income from the pension fund and top it up tax-free from the ISA

Leave it all invested to maximise growth potential for a later date

We would be delighted to explain this in more detail, discuss why it is so popular with the next generation of investors and help you get your 55 Plan up and running.

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