When we are young and begin our careers retirement is often the furthest thing from our minds. However the ideal time to plan and save for retirement is basically as soon as possible. The sooner you start the bigger the pension pot will be.

An interesting metaphor to illustrate the effect of compound growth in later years and why it is so important to start early is the golfing example. If at the start of a game of golf you bet your partner 10c for the first hole and you agree to double the wager each hole, so that the 2nd hole is 20c, third is 40c, and so on. What do you think the wager would be at the 10th? $51.20, at the 15th $1638.40 at the 18th it rises to $13,107.20.

Retirement planning as an expatriate or international investor is very important. There are many tax advantages to using offshore pension plans and for those people retiring from the UK there are QROPS or SIPPS these can reduce tax on UK based pensions quite considerably, and at the same time give you access to 30% of your pension funds without the need to buy an annuity. You can actually use these vehicles to buy property. See our QROPS and SIPPS sections. For investors from other countries in Europe the QNUPS may be an ideal way of removing your home based pension assets from the burden of tax?

For younger expatriates this is actually the ideal time to begin planning for the golden years. You should not rely on social security benefits or generous windfalls from investments, or company pension schemes if there is the possibility you will not be with that company long-term? So we recommend taking a proactive approach to retirement planning.

We only recommend large household names based on the Isle of Man and Guernsey for offshore pension planning. These companies are amongst the largest and most respected in the world, and both locations offer excellent investor protection laws safeguarding up to 90% of client funds.

Pensions in home country locations such as the UK, USA and mainland Europe ‘Onshore Pensions’ usually combine benefits such as payments on death or disability together with pension fund contributions which can normally be offset against tax. The idea is that governments encourage you to contribute to either a company pension scheme or your own personal pension plan; they provide tax breaks on premiums. You are then forced to comply with various rules such as a minimum age you can take your pension. Normally at least 75% of your pension value must be used to purchase an annuity, and any income from your pension is taxed at the prevailing rate, but to name a few of the restrictions.

Offshore pension planning is quite straight forward, using AAA rated areas such as the Isle of Man and Guernsey where there are no tax implications, no restrictions on how and when you can take your pension? You can encash all of it at any age and will never be obliged to purchase an annuity. An offshore pension investment means simply building up a secure, tax-efficient fund which can be distributed when and where you want it in future. One of the most important aspects of living offshore is that you do not loose any time building up your pension pot. The earlier you start contributing a percentage of your income the bigger your pension fund will be. The later you start your pension planning you will have to contribute a larger percentage of your income, as you will have less time to take advantage of compound growth?

To illustrate the difference that starting to save early can make, take an expatriate who wants to save £500,000 for retirement. Assuming an 8% return on investments, if our expatriate began saving 20 years prior to retirement he or she would need to save £875 per month, while those who start saving 30 years before retirement will need to save only £355 per month. This is a £420 per month difference that.

In order to be able to live more comfortably pre and post-retirement and not have to work years longer than planned, start saving as soon as possible. If your employer offers a retirement savings plan you should take advantage of this great benefit.

Planning for retirement is one of the largest investments that individuals will make during their lives. In order to retire at a specific age and be able to live comfortably, a savings plan must be developed and strictly followed. The earlier a person begins saving, the better off he or she will be when retirement age comes around.

Here at Balquidder we have the latest in pension calculator models and our advisors can help you establish how much you need to be saving in order to achieve your target pension fund value. This number reflects how much you will need to save in order to have the income desired during your retirement years.

We only recommend large household names based on the Isle of Man and Guernsey for offshore pension planning. These companies are amongst the largest and most respected in the world, and both locations offer excellent investor protection laws safeguarding up to 90% of client funds.