Pension Essay Example | Topics and Well Written Essays - 2750 words

Pension - Essay Examplee payments to the NIC however, iodin can be credited with the NIC if they are getting some formal benefits such as unemployment, unsoundness and parental benefits (BLAKE, 2003, p.68).The current subvention scheme is designed to have a flat-rate first-tier pension plan provided by the state. This pension scheme is referred to as Basic State Pension (BSP).Secondly we have the second tier or supplementary pension schemes which is provided by the state, private financial institutions, banks, insurance firms and employers. The BSP allows a pension scheme that is unhopeful compared to averages earnings, but the plan is fully indexed to prices upon retirement of the somebody. The second tier pension plan offers relatively high up pension that is partially indexed to prices up to a maximum of 5% per year subsequently retirement. One of the disadvantages of the occupational pension schemes is that it is subject to change after change in employer. Lastly, we have the personal pension plans that offer partially indexed pensions but based on unpredictable investment returns and high administrative cost convoluted (BUCKLE and THOMPSON, 2004, p.126)To get the basic pension one is required to have 30 qualifying years (NIC payments) and at least eleven qualifying years to generate 25% of the max amount. The pension received is taxed by the government but the payments are gross meaning that one is taxed when they start getting their pension. It is apparent that a student who plans to start a pension for future use should know that there different types of pension one can pay and save the money. These types include state pension where an individual receives the money after retirement in regards to the number of years one has contributed or paid to National Insurance Contributions (NICs) (BUCKLE and THOMPSON, 2004, p.130).The individual should know that the eligible number of qualifying years one has to attain is eleven years, which generates twenty - five pct of the saving. For one to receive the