There are growing worries in regards to the UK pension system, and how it will fair over the coming months. We have seen no end of large companies going into administration and potentially causing many Brits to have a reduced pension or no pension when they retire.

Reader's Digest is the most recent victim, their pension deficit hit £125m and thousands of employees do not know if they will receive any funding when they retire!

The Pension Protection Fund is supposed to cover up to 90% of employee pensions; however this Fund is made up of other companies helping to bail out the firm in administration.

Could this lead to the Lehman Brothers of the pension world?

If one large company falls, there could be a domino effect and we could see a long line of companies that simply can’t afford the bail out; this could eventually lead to them not honouring their own employee pensions.

Many large companies such as Nortel, British Airways, BAE and BT have admitted to having large pension deficits and many experts have said that the coming years will be difficult.

These fears have sparked off interest in Self Invested Personal Pensions (SIPPs) and Qualifying Recognised Overseas Pension Schemes (QROPs).