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The Government Actuary's estimates put life expectancy at 91 for a female born today. As we are living longer, it therefore makes sense to maximise your pension, and the earlier you start saving, the more money you’re likely to have.
Indeed, the money saved into a pension between the ages of 25 and 35 can account for up to half your final amount. The main reason is the effect of compound interest, where the interest on money you save earns interest on itself over time. Start a pension at 25, say, and at 6% pa, £50 a month would provide £100,000 at retirement (age 65). Delay the start until the age of 35 and that same £50 per month produces just £50,000.
For more information and a free initial appointment, please contact our Independent Financial Advice Team on 01900 603623.
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