Private pension savings are a very good option for increased pension savings and something that everyone should take advantage of. Those who contribute 2-4% of their wages are entitled to a 2% contribution from their employer, according to most collective wage agreements.
The advantages of private pension savings
The matching contribution from the employer, together with a deferral of tax on deposit, means that no other form of savings plans can compare with private pensions. The advantages include:
• Tax benefits – the private pension payment is not taxed on deposit
• A contribution from the employer
• No capitals gains tax or net worth tax
• It does not curtail either child benefits or interest benefits
• The savings are inheritable
• It’s an easy form of saving – the employer is responsible for the regular payment of the savings
• An agreement can be reached on the division of entitlements between fund members and spouses
• Withdrawals can begin at the age of 60
• More disposable funds during retirement