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Pension Jargon Explained

This page will act as a dictionary for all the different pension terms you may hear about like:

    • Basic State Pension 
    • benefit crystallisation event
    • Consumer Prices Index
    • money purchase annual allowance
    • National Insurance contributions 
    • pay as you earn
    • pension commencement lump sum
    • per annum
      • Annum is just a fancy way of saying year.
    • Retail Prices Index
    • Consumer Price index
    • State Pension age
  • uncrystallised funds pension lump sum
  • Lifetime Allowance
    • This is the amount you are allowed to have in your pension funds before you are penalised with the Lifetime Allowance charge. It is currently £1,030,000 and it is planned to increase with inflation over the next few years.
  • Pension Freedoms
    • This is the phrase used in the media to describe the increased flexibility of pensions since George Osborne changed the rules in 2015.
  • Defined Benefit
    • Read full guide here.
  • Defined Contributions
    • Read full guide here.
  • SIPP
    • SIPP is short for self invested personal pension. They give a lot more options in what your pension can be invested in. Whilst this can be good, it has led to a number of scam investment schemes. Tread very carefully if you are considering a SIPP. Read more information here.
  • SSAS
  • Annual Allowance
  • Workplace pension

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