When it comes to planning your finances for the future, you have to do battle against a familiar foe: myths. There are a huge number of different myths about pensions and financial management in later life, which can make it extremely difficult to know how to go about managing your own plans for retirement.

So, let’s try and shed some clarity on the matter. Below are four of the most frequently heard myths and misconceptions on the subject of retirement and financial management— let’s go through and see which are accurate, and which you can feel comfortable ignoring…

Myth: Your personal pension fund can run out of money.

True or False? True.

Yes, sadly, this myth is true. People are living longer than ever before, which is wonderful, but it does have a worrying consequence: it is more and more likely we will see people living long enough to run out of funds in their pension. This is a prime example of why proper, in-depth retirement planning is an absolute essential; the more you are able to build up, the longer your pension pot will last.

Myth: You can’t start saving for retirement until you’re 21/22/25 (the age varies with this myth!)

True or False? Half-and-half.

It’s true that some company pension schemes do not allow employees to join until they reach a certain age, but this isn’t always the case. Rather than assuming your youth means you won’t be able to join your company’s pension scheme, it’s always best to ask and make sure you are proceeding with the correct information. If you can join the scheme, then great! If not, you still have other options that will allow you to save sooner; a financial advisor will be able to guide you further on this.

Myth: Pensions are a waste of money if you die before you have the chance to retire.

True or False? False.

If you die before you are able to claim your pension, the money is not wasted. It is distributed to your chosen beneficiaries instead, so you can always be sure that the funds you save will be used by either you or someone you care about.

Myth: Your former employer can cut your pension fund at any time.

True or False? True.

Yes, sadly, this can and does happen. If your former employer is struggling to pay their pension bill, they may cut the amount of money you receive in your retirement. As worrying as this sounds, it is a relatively unusual event. It’s also worth noting that while the amount you receive may be cut, it’s unlikely to vanish altogether, so it’s still definitely worth joining your company pension scheme.


Now you have a better idea regarding the truth of retirement, financial planning, and pensions, you can make your own plans safe in the knowledge you do so with the full backing of the facts. Good luck!

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