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Baby boom for pension's savings
22 October 2008 15:28
Parents should start making payments into a child's pension fund as soon as possible, it has been recommended.
The proposition comes from Virgin Money, which believes that starting a pension at the earliest opportunity is a concept that should not be ignored.
The lender states that 18 years of payments combined with stock market growth could set a child up for their post-working life.
Grant Banther, a spokesman for Virgin Money, said that even modest amounts saved now would make a big difference to pension payments in later years.
By paying £50 a month from a child's birth until his or her 18th birthday, they will already have a pension pot of over £23,000 - which will have plenty of time to grow before it matures, he added.
An expert at the financial firm Hargreave Lansdown warned earlier this month that pension funds could seriously be damaged by the effects of the credit crunch.
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