It is important to ensure that pension arrangements are reviewed periodically. Changes in product design and legislation have had a dramatic effect on the options available for pension policyholders.
At retirement, your pension fund should have become one of your largest assets. It therefore follows that serious attention should be given to the way in which this fund is managed.
Since the introduction of stakeholder pension plans during 2001, pension providers have continuously redesigned their plans in order to attract and retain new business.
The advantages to policyholders have been dramatic, particularly with charge reductions. Typically, a stakeholder pension plan will charge only 1 to 1.5% of the fund value per year, which represents a significant reduction against older traditional pension plans.
However, stakeholder plans are generally restrictive in terms of investment fund choice.
Some providers have also developed extremely useful non-stakeholder personal pension plans where charges are still very low, but which also provide access to leading investment fund managers offering clients increased choice and the potential for much greater investment growth.
It is important to remember, that a pension plan is an investment.
Fund selection is a crucial aspect to pension planning and should be revisited periodically. For this reason it is important that pension funds are periodically reviewed in order to identify whether improvements can be made, that will either increase the potential for fund growth, reduce plan charges, or both.
On 6th April 2006, pension legislation underwent the most radical overhaul in recent history. This new regime impacts on all pension investors making it even more important to review those pension plans.
Professional Wealthcare has been looking after pension assets for many years. People often have a selection of plans from old employer schemes, period of self employment, or perhaps from contracting out of the State Second Pension (Formally known as SERPS). For many, this can seem like a ‘minefield’ of confusing facts and figures. With careful planning, significant improvements could be made to increase your future wealth and to simplify your retirement plans.
Please note past performance is not necessarily a guide to future returns.