Understanding Stakeholder Pensions

stakeholder pension

Stakeholder pensions are generally targeted at those individuals who have low incomes or fluctuating earnings. This type of pension scheme offers a less complicated, more cost effective alternative to setting up a personal pension.

The maximum amount you can contribute annually to a stakeholder pension is the same as for a personal pension.  It is possible to pay more money into the pension but with no tax relief. 

Stakeholder pensions must legally meet a number of standards to ensure they remain flexible and secure.

These standards include:

  • Managers can charge fees of 1.5% of your pension fund each year for the first 10 years you hold the product, and after that up to 1%
  • Contributions can start from as little as £20, and you can pay weekly, monthly or less regularly
  • Scheme must be run by authorised stakeholder manager or trustees.

To find out if a stakeholder pension is right for you or to discuss the benefits of your current pension scheme you can call our customer service team on 0844 417 9517 and they will arrange for an FCA regulated adviser to call you back at a convenient time.

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