Most people believe their largest asset is their house; however this is not necessary true and for many people their largest asset will be their pension fund.

You may spend an hour each year checking your car or house insurance to make sure you have the best deal and no end of legal fees if you move house, but what have you done about your pension? When did you last review it? What are you expecting to do when you retire? 

The first question to ask is “Am I in a pension scheme?” Many people will put off joining a scheme, but the sooner you join the sooner you start to build up benefits.  This is particularly important if you have access to a company pension scheme as once you have missed company contributions they are gone and you are giving away free money.

Once you are in a scheme, understand the scheme and how it works, is it defined benefit or defined contribution, you would be surprised how many people do not know what type of scheme they are in and what the differences are.  Find out what the expected benefits are and keep track of these, most schemes now have some form of online access which makes this easier than it used to be.

When keeping track, is the pension on course to give you what you want? If not you may wish to see an independent financial adviser about the benefits of increasing pension scheme contributions versus other financial products. 

If you are in a defined contribution scheme are your contributions in the funds which meet your needs and reflect your view of risk, some funds will be more risky than others.  If you do not understand do some research and ask questions of your provider, as it is important you understand what you have.

Once you have an understanding you can prepare a plan of what you expect to have for retirement do you need your pension scheme to provide you with an income of £5,000 p.a. or £10,000 p.a. or more, look at this on a regular basis to make sure you are on target and if you are not on target understand why not and if there is anything you wish to do.

In the end if you are not sure about your pension, seek some professional advice, you would spend thousands of pounds buying a house, just spend a little to make sure you understand what you have and what you expect to receive. After all you would not want to get to your 60^th birthday, expecting to retire and then find you are going to have to work for another 5 years or even 10 years more!

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