Stakeholder Pensions UK
The Government introduced a new type of pension scheme called Stakeholder pensions in April 2001. They ended an era of rip off pension plans.
Unlike existing personal pensions, stakeholders are lower cost and are flexible so they can be moved around without penalties. (You can read more about this in charges and flexibility)
However take up of the stakeholder pension has been well below expectations. It seems that it has mainly benefitted the rich by providing them with a vehicle for playing with their money, for example as a way of saving for their childrens’ futures.
Who’s it for?
The UK Stakeholder pension was supposed to be aimed at those on “moderate earnings”.
But, after it’s launch, the government claimed it was always intended for anyone.
Anyone from a newborn baby to a granny can have a Stakeholder Pension.
How much can you pay in?
If you are not earning, The maximum you can put into a Stakeholder is £3,600 pa gross (i.e. including the tax benefit)
If you are earning the same limits apply as for personal and occupational pensions – and that’s as much as you like up to the annual £255,000 limit provided the money come from employment or self employment and not savings or dividends.