In addition "This perception isn't helped by the constant meddling from politicians meaning that pension legislation seems to be constantly changing, which doesn't exactly create confidence in the pensions industry."
It is clear that savings vehicles like ISAs and Buy-to Let can be used to help save for retirement but for the vast majority of people they are quite likely to not be as effective as a pension, which is specifically designed for the purpose. Alongside this it is important to remember the tax implications of other sources of retirement income. Income tax could be liable on your rental income as much as it is on your pension income but at the end of the day when you want to sell you could face huge capital gains tax bills. You also need to consider Inheritance Tax as much as you may want to leave property to family members it is one of the least tax efficient assets to pass on.
ISAs of course have tax advantages, all money held in an ISA grows free of income tax and when you cash it in there in no Capital Gains and they are more flexible than pensions too so you can access your money at any time. However that tax relief up front, combined with the benefits of compound growth over the long term can still give pensions the edge.
Issued by: Enable Independent Financial Life Planners 25c North Street, Bishops Stortford, Herts CM23 2LD Telephone: 01279 755950 - Fax: 01279 657339 Enable Independent Financial Life Planners is a trading style of Enable Independent Limited is authorised and regulated by the Financial Conduct Authority. It is important always to seek independent financial advice before making any decision regarding your finances. If you would like any assistance, please contact us. NOTHING CONTAINED IN THE ARTICLES SHOULD BE CONSIDERED AS GIVING INDIVIDUAL FINANCIAL ADVICE
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