What should I look for when I’m deciding which pension option would be best for me?

When you are choosing which pension option is best for you, you should think about the following points.

• You should compare the charges you will have to pay for a personal pension with the charges for a stakeholder pension. The charges that stakeholder pensions can make are as follows:
  • 1% of the value of your pension fund each year to manage your fund. The charges are taken from your fund.
  • As well as the 1%, the law allows stakeholder pension providers to recover costs and charges they have to pay for certain other things. For example, when they have to pay any stamp duty or other charges for buying and selling investments for your fund, or for particular circumstances such as the costs of sharing a pension when a couple divorce. These expenses are found in other pensions, not just stakeholder pensions.
  • With stakeholder pensions, any extra services and charges not provided for by law must be optional. Extra services include advice on choosing a pension or life assurance cover. You must have agreed to these extra charges as a separate arrangement, and the charges must be clearly defined for the services you are being offered.
• Your employer can contribute to different types of pension scheme, including stakeholder and personal pensions, as well as occupational schemes. If you are thinking about taking out a stakeholder pension or a personal pension, you should ask your employer if they would contribute to it.
• Some types of pensions give you more say than others over how your pension fund gets invested. If you want to have a say in this, you should bear it in mind when you look at the different types of pensions available.
• If you are already paying into a personal pension, find out what charges you may have to pay if you decide to transfer to a different scheme. Some people may be better off staying with their existing scheme. If you are not sure what to do for the best, you should get help.