pensionsandsavings.com

  • PENSIONSANDSAVINGS.COM

    From Ros Altmann:economist and pensions,
    investment and retirement policy expert

    • pensionsandsavings.com

    pensionsandsavings.com

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    Category: Annuities and Income Drawdown

    Annuities – now FCA Consumer Panel calls for urgent reform

    Annuities – now FCA Consumer Panel calls for urgent reform

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    9 December 2013 Financial Services Consumer Panel slams annuity market Calls for urgent regulatory reform – this is long overdue Fears that annuities don’t offer value for money and insurers making excessive profits Annuity consumers need better protection:  A report just released by the Financial Services Consumer Panel (FSCP) calls for urgent regulatory reform of annuity sales, in order to protect consumers.  http://www.ifaonline.co.uk/ifaonline/news/2317942/fscp-demands-change-in-the-non-advised-annuities-market The FSCP is the consumer body of the FCA – the financial services regulator – and its…

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    Pensions Regulator misses an opportunity to ensure DC trustees address annuity inadequacy

    Pensions Regulator misses an opportunity to ensure DC trustees address annuity inadequacy

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    22 November 2013 Another missed opportunity to address the inadequacies of annuities The Pensions Regulator Code of Practice for DC scheme trustees suggests  independent advice or using an annuity broker are of equal value to members But annuity brokers provide no advice, won’t explain benefits of not buying, don’t ensure right product or best rate and still charge fees Independent financial advice should ensure members optimise the value of their pension fund with right timing, right product and best rate…

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    Annuity providers keep £1billion a year as widows left penniless

    Annuity providers keep £1billion a year as widows left penniless

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    18 November 2013 Widows penniless while insurers pocket £1billion a year from husbands’ pension funds   Companies make huge profits as customers buy wrong annuity because they don’t understand complex terms Focus just on ‘shopping around’ or ‘best rate’ is not enough, need right product first Channel 4 Dispatches reveals real life example of this failure and insurer agrees to change annuity terms The UK annuity market is failing its customers.  An annuity is a product sold by insurers who…

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    Auto-enrolment focus on pension fund charges misses the bigger picture

    Auto-enrolment focus on pension fund charges misses the bigger picture

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    11 November 2013 There are no controls on charges people forced to pay when buying their actual pension Far more money can be lost on annuitisation than saving 0.25% in fees 0.25% charge on £30,000 fund is £75pa but customers lose £600-£1000 when buying their annuity at retirement with no advice Auto-enrolment needs to ensure pensions are good value:  There has been significant debate about capping fees and charges on auto-enrolment pension funds and estimates that people are losing chunks…

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    Time for change: Make pensions fit for 21st Century retirement

    Time for change: Make pensions fit for 21st Century retirement

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    14 October 2013 TIME FOR CHANGE:  Rethinking pensions and retirement Pension options not fit for the future as ‘low risk’ investments have become more risky and retirement becomes a process not an event Auto-enrolment pension funds not fit for the future:  Retirement is changing, pensions need to change too. As auto-enrolment ensures millions of people are about to start saving in pension schemes at work, it is important to make future pensions fit future lifestyles.  There is a real danger…

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    Why everyone should consider income drawdown before buying an annuity

    Why everyone should consider income drawdown before buying an annuity

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    What to do with your pension pot as you approach retirement is an important issue to explore. Most people don’t realise they don’t have to buy an annuity: All too often, people just assume they have to annuitise, and never engage with the important alternative options available to them. Annuities are irreversible:  Once you have bought an annuity, you can’t change it. You will never have a second chance. Annuities won’t protect you against serious retirement risks: It’s like putting…

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    Potential good news for pensioners as gilt yields rise

    Potential good news for pensioners as gilt yields rise

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    17 September 2013 Rising gilt yields and revised regulations could increase pensioner incomes from income drawdown by 50% But inflexibility prevents pensioners from accessing more of their money By the time they are allowed to, the opportunity may be lost Need to make drawdown more flexible and allow for ill-health  Recent rises in gilt yields and Treasury rule changes for income drawdown mean people could now take much more money out of their pension funds than last year.  This should…

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    To buy or not to buy – annuities are a gamble

    To buy or not to buy – annuities are a gamble

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    Yes, not buying an annuity is a gamble, as is buying one! The attempts to defend annuity purchase are rather too simplistic.  Of course it is the case that not buying an annuity is a gamble, but what people do not yet realise is that buying one is also a gamble.  Customers need to understand that any decision around annuities is risky.  Currently, the industry and providers and even trustees seem to believe that buying an annuity is the ‘safe’,…

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    The crazy world of annuities – hiring a chauffeur-driven limousine cheaper than finding your way by bus

    The crazy world of annuities – hiring a chauffeur-driven limousine cheaper than finding your way by bus

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      Do you understand how annuities work? Millions will be auto-enrolled into a system that is not fit for purpose The Government is encouraging millions of workers to save in a pension scheme to improve their retirement income.  If you are a worker earning above the tax threshold you will be automatically enrolled into company pensions and (assuming you do not opt out) you will be paying contributions for many years to build up a retirement fund.  Most new auto-enrolment…

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    10 things an annuity will guarantee you

    10 things an annuity will guarantee you

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    20 August 2013 1. A single life level  annuity guarantees that your pension fund will not ‘run out of money’ and the income you receive from your pension fund will be fixed now for the rest of your life.  You know what you will get each year. 2. It guarantees that you will never get a higher income than this even if annuity rates rise in future. 3. It guarantees that your income has no protection against inflation, so your…

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