'The earlier you start saving, the easier it will be to reach your goals'

Why should young people start a pension?

To enjoy retirement you need to plan how you will replace your income.

You could rely on the state, but for many people that will not be enough. The typical state pension is currently just £90.70 a week. Pensions are the only savings product solely designed to give you an income when you retire.

Your contributions attract tax relief and if your employer also contributes, by not taking up his offer you are effectively voluntarily giving up part of your pay.

How much do you need to save each year to receive £25,000 a year in a pension?

Far more than most people realise. A 30-year-old person - just starting to save and hoping to retire at 65 - would probably need to put away £600 a month. However, the earlier you start to save, the less onerous it will be.

By starting to save five years earlier, the monthly contribution needed would likely fall to around £500.

If you started saving £100 a month from age 25, at 65 your pension fund might buy a pension of about £5,000 a year.

Why choose a pension as opposed to property, shares or cash savings? Are pensions risky?

Pensions should simply be seen as a savings vehicle, except one that attracts relatively generous tax-relief. However, you are limited to when and how you can access your savings. But on the other hand their long-term nature encourages a savings discipline.

What a lot of people don't realise is that the various ways of saving, for example investing in property or buying shares, can all be achieved through the wrapper of a pension's policy.

Like other forms of saving, the value of your fund will rise and fall depending on what you are investing in but there is no protection against investments falling in value. However you should have a choice on how your savings are invested and therefore you can choose to move your monies into less volatile investments, like bonds, as you near retirement. In the unlikely event that the firm managing your investment fund(s) went bust, help could be provided by the Financial Services Compensation Scheme, the level of which depends on the type of investment.

Why are the young shunning pensions?

Young people often have a whole host of liabilities and commitments such as student debt, house deposits etc. It's a very difficult balancing act but the earlier you can start to save for retirement the easier it will be to achieve your goals.

Where should one go for pensions advice?

The Pensions Advisory Service's website, www.pensionsadvisoryservice.org.uk gives information and guidance on private and company pensions, as well as the state pension. The Financial Services Authority runs a website, www.moneymadeclear.fsa.gov.uk, giving help on all financial products.