In simple terms, your State Pension Forecast estimates how much State…
Pensions benefit from favourable tax treatment – to encourage us to put…
According to the Department of Work and Pensions, quoted by the Daily Mail, (here), more than a million pensioners depend on the state pension for all their income. This means that more than a million people are living below the official poverty line and have little prospect of income rising in real terms.
The weekend press has a few articles about Pension Freedoms and converting final salary schemes into a cash lump sum to be invested. As financial advisers, this is not an area we advise on, (except for a long-term client at their Normal Retirement Age), but I can see the issues around this rumbling along for decades.
Back on the 4th January 2017, Ros Altmann, the ex-Pensions minister, media commentator and finance blogger posted an article about the potential threats to the current pension structure posed by a change in emphasis by the Treasury, who appear to be pressing the case of the “Lifetime ISA” at the expense of the existing pension regime.
The financial press has been carrying a number of stories where the regulated adviser believed that all they had done was follow client’s instruction, but after a complaint the Financial Ombudsman Service disagreed and awarded compensation. An example is here.
A press release from The Pensions Regulator this morning, (21st April 2016), and articles in the financial press highlights the plight of employers who make a mess of their auto-enrolment duties. Swindon Town Football Company Limited, the trading entity behind the Division 1 football club, was fined £22,900 for not enrolling workers into a pension scheme and other workplace pension duties.
A new financial year brings new expectations, so it would be a good idea to understand what is realistic and consider the dividing line between a sensible projection and the implausible marketing claim.
A recent research project by the Citizens Advice Bureau highlighted that new retirees have little idea of what to expect as a sustainable income and are often drawn to an implausible “guaranteed return”, like a moth to a flame. In a research experiment 88% of responders were drawn to “guaranteed” returns of 10-15%.