I want to start saving for my retirement. As I am in my mid 30s I am concerned that I am limiting my time so what are my options?

Well really I am afraid there is no substitution for regular substantial payments, however there are a number of things you can do to improve the potential outcome.

You should sit down and think about the following issues;

What do you want from a pension (how much, when)?

How 'active' do you want to be in managing it (there is no substitute for involvement in how your money grows for making all concerned concentrate on the outcome)?

Look hard at the costs - cheapest won't necessarily be best, but make sure that what you are paying offers good value.

Get good advice - and at risk of showing my prejudices I'd suggest an IFA might be a good place to start - they will not be cheapest, but ask them to demonstrate that they can add more value than the differential in cost, a good IFA will be comfortable with that discussion.

If you have surplus capital, or annual bonuses or profits surplus to your immediate needs a lump sum contribution can be a major boost, but you may wish to think about phasing how it is invested, so that you aren't exposed to any sudden market drops just after investment.

Decide how much risk you can take - classic human psychology is to invest at the top of a bubble, and sell at the bottom - the exact opposite of rational behaviour - of course this is only obvious with hindsight, and by ensuring you are not in a market which you will not be able to stand when things go wrong then you can hopefully avoid this dreadful mistake. Getting timing right is very very difficult, getting it wrong is very very simple, so the best option for most people is to ignore timing, and the only way to do that is to be in markets where getting it wrong won't force you to disinvest for emotional reasons.

Oh, finally, and very importantly, if you are employed check whether your employer will contribute on your behalf, either into a scheme they sponsor, or yours - for many people the largest part of their pension contribution comes from their employer - joining an employer funded pension is really like a payrise - it may 'cost' a few pounds from your net salary for your contribution but the benefit is usually comparatively huge.

Best of luck - and remember the worst decision you can make is to do nothing.

Saving/investing via a pension is seen as the most tax efficient means of doing so and thus most likely to produce the biggest fund from the same sums invested.

However you need to be aware that pensions cannot be accessed until you are at least 55, you may then only take out up to 25% of your capital in one go, and the balance has to be used to generate a taxable income for you for the rest of your life. Many therfroe consdier you may have more flexibility investing via ISAs when you are younger and then switching fudns inlarge tranches inot pensions later on. The downside to ISA investing is that the charges are higher, there is no upfront massive tax boost and you might well be tempted to take out some, or all, of your capital for poor reasons severly weakening your essential longer term income needs.

A good rule of thumb is to take the age at which you start making contributions (say 30) divide it in two (15) and this then is the percentage of your earnings which you should aim to set aside until you retire if you are seeking at least a decent level of income in retirement - at least 50% of what you were earning.

Using this formula you can see that an 18 year old only needs to contribute 9% of earnings every year but a forty year old with no pension savings to that point needs to set aside a rather ambitious 20%!

Whatever route you choose - and some even choose buying property to let - you need to be clear that total savings need to be at serious levels and maintaned for a long time. Basically the sooner you start and the more you can save the better (not rocket science) but you will need to target total funds/assets well into the hundreds of thousands I'm afraid.

If your budget allows, then of course you should consider a portfolio of different investments but most people cannot (at least not usually when they first start). if you look at which investment will give you the most income as a % or £ then it will always be a pension as the fund will always be larger than an ISA invested in the same way for the same cost but without tax relief. whereas if you want the biggest amount of £ available, at the moment that is an ISA as you can take the whole fund. The reason that the pension is currently restricted to 25% (although this is under review) is that the tax relief costs the Treasury a lot and therefore they will rightly want to dictate some rules as to how and when the money is used. Don't be fooled by all the pension bashing media. A bad investment will always be bad, will always stink, and often can be found just as easily within a pension or an ISA. How many people have you heard tell you that property is their pension as property never fails, always goes up, except for the recent recession and previous market corrections!

An IFA will help you to assess youre needs and then recommend a financial plan to meet all of your needs but don't be put off. You might find that you need to save £500pm to reach your goal, but if you can only afford £100 now, you should still get underway as you can increase what you save later as long as you are disciplined. But don't ever be fooled that £100pm invested into anything will give you a luxurious lifestyle (unless you are also going to save for a baby's retirement!). The key weapon you still have is time in the market, your budget will allow you to moderate your risk profile to meet your objectives.