Flexible pensions for contractors from Raindrop
Put simply, a pension is a long-term savings plan designed to financially prepare you for when you stop working.
During your working life, you save into a pension to build up a pot of cash for when you retire. The best part though, is that in addition to the amount you save, you benefit from a top-up from the government of at least 25% every time you contribute from your net income (limited by annual allowance). So, if you pay £80 into your pension, you’ll get at least an additional £20 from the government. If you’re employed you’ll normally pay in straight from gross wages which means you are saving that amount in income tax.
Since 2012 employers are required to automatically enrol employees into a pension scheme as well as contribute to it. Unfortunately, nothing similar exists for self-employed people. The diversity and flexible working patterns of the self-employed has made it difficult to find a workable solution.
For these reasons, Raindrop is providing a personal pension solution that truly suits the needs of the self-employed.
The value of your pension can go up as well as down. Capital at risk.
Why Raindrop for your contractor pension?
Raindrop are offering a £50 top-up to your pension pot when you sign up through ContractorUK to help you get started. Offer valid until April 5th.
3 simple steps to plan your retirement:
- Set your goal
- Pick an investment
- Watch your money grow
The State Pension
Alongside your private pension you may also be eligible for the state pension provided by the government.
Depending on your retirement age you will have to contribute to the National Insurance system for as many as 35 years to be eligible for the full State Pension. Even then, you’ll only get roughly £9,100 per year from it (based on the current amount). This breaks down to only £175.20 a week.
It’s unlikely that the State Pension will provide enough income for you to maintain your standard of living when you retire and there are also concerns around the funding of the State Pension. So, the government is keen for you to consider private pensions.