Page 104 - Benjamin Franklin\'s The Way to Wealth: A 52 brilliant ideas interpretation - PDFDrive.com

cost-effective, since the normal arrangement is that your employer either
tops up your contribution or may match it—so you end up with more than
you paid in. These days there is, however, a certain cynicism about
company pensions due to unscrupulous executives raiding them. Such cases
are rare but if you are genuinely hesitant about trusting your future to your
company then consider a personal pension scheme.

Private pensions are still better than most other savings because most
governments give them sizeable tax breaks and some even help top up your
contributions. Again there have been scandals with banks failing and
pension schemes evaporating, but these are extremely rare and where
investment companies are covered by national banking codes individual
investors should get their money back.

The third main approach is to go for investments such as property. This can
be personally satisfying and a great deal more fun than simply paying into
a pension fund managed by another, but you are unlikely to benefit from
the same kind of tax benefits extended to more formal schemes. Don’t
forget to consider the risks, though.

HERE’S AN IDEA FOR YOU…
Don’t think about a pension, think about lots of pensions. Diversify and
spread your risk across a mix of tax-free savings, investments and
formal pension schemes. For example, rather than buying a property
think about investing in a property fund and spreading your investment
that way.