What is a Pension? A pension is a long-term tax-efficient financial tool used to enable your retirement. There are some differences between a personal pension and a workplace pension. The main types of workplace pensions are Defined Contribution (DC) and Defined Benefits (DB). The DC workplace pension requires both the employer and employee to contribute. The income on retirement depends on factors such as stock market performance, the amount of money contributed to the scheme and related charges. DB schemes are mainly used in the public sector, and pensions work on a benefits package dictated by the number of years and income with that specific employer. The income on retirement is effectively guaranteed.
Why do we do it? To support the employee’s lifestyle in retirement. This can give peace of mind to an employee, knowing that their current work is contributing towards future security. A workplace pension can reduce your NICs and tax liability. Some employers contribute above the minimum contributions and will match the employee contribution up to a certain % of gross income.
What do we need from the client? We must understand what you prioritise for your employees. How much you are willing to put towards the pension scheme, and the options you think your employees will want.
What will we produce? We will create and present a pension plan. We will discuss our recommendations and ensure you understand what we recommend and why.
What tools do we use?
- FE analytics – a robust database and analysis tool containing most funds’ historical data. We use this to show how your current portfolios would have fared through time and how we can help improve them.
- Morningstar – we use model portfolio services from leading investment houses for most of our clients. Morningstar allows us to compare the long-term performance of these investment houses against one another. It forms a critical part of our central investment proposition research.
- Dynamic planner – allows us to risk map your existing portfolios to our risk yardstick, showing us if the portfolio meets your risk expectations and suits your goals and investment preferences. It also allows us to run psychometric tests with you, to help us establish your risk preferences, capacity and ability to take risks, and ethical choices. The tool works as both an analyser and a discovery tool. It also allows us to scour the market for the most appropriate custodians/platforms to house your assets.
Note. Levels and bases of, and relief from, taxation are subject to change. Because this investment may go down in value as well as up, you may not get back the full amount invested. Past performance is not a reliable indicator of future results.