It does not sound convincing to put money in a bank and not get to use it for at least 30 years. The fact that you are not sure whether it will be worth more than its current value is worrying. Keeping all this in mind, many young people are opting to make alternative investments instead of paying for a pension plan. Such investments include the following.
It is not surprising that many young people are forgoing pensions and investing in property. This is one sure way to secure their lives once they are too old to work or earn a living. Properties will continue to earn them a decent income without having to even lift a finger. The most important thing is investing early in life so that, at their old age, they can sit back and enjoy the fruits of their labor.
ISAs Savings :
Cash ISAs go beyond the standard saving accounts since they don’t charge tax on whatever interest the client earns. This is a great investment for anyone paying higher-rate taxes as they will avoid 40% of the same on their savings interest. Persons in the basic-rate tax save up to 20%. However, if you choose to go for ISAs shares and stocks, you will be exempted from capital gains (CGT) and income taxes. The latter can be charged as high as 28% whenever you make more than the annual CGT allowance gain of £ 11,300.
Internet Businesses :
Such ventures are continuing to gain popularity and earn profits by making advertisements. The most lucrative of such businesses is social networking where the young are making maximum use of the internet to network globally. This is a business that most young people understand very well and are always looking out for as they mean a secure future for them.
IT Industry :
This industry is heading for the sky. Every day brings new and better inventions for all the savvy customers. These are usually young people who are making the industry to grow at an astonishing rate. When you invest the right amount in the ideal company and in a timely manner, the returns will be more than gratifying. With such a promising industry, there is no need to worry about a pension plan
Internet-based businesses make good money through advertisement revenue, despite the turbulent times that other sectors experience. Social networking is increasingly turning out to be an economically viable venture. So, be keen on internet companies as their future looks promising.
Personal Pension :
With the rising rate of unemployment, young people are going into private businesses. This means that they miss out on workplace pensions. The situation forces them to set up personal pension schemes. There are many organizations willing to offer them private pension solutions. Such schemes come with many options that they get to choose from. Some of the things to consider comparing personal pensions are:
- The charges required to run the pension
- Rules that apply to the size or timing of the contributions
- The investment options for your fund
- How easy it is to transfer your savings to any other scheme in case you feel like it
With any of the above options, young people do not have to be tied down by pension plans or be forced to find formal employment to access the same.