The 20 largest OECD countries have a combined public pension deficit of $78 Trillion. Many large corporate pension schemes are likewise significantly underfunded.
With over 44% of men and 55% of women now expected to live into their 90s, many consumers will outlive their private savings by 5 years and some by at least 10 years.
Current retirement income products such as life annuities are unpopular due to low returns mostly caused by the high costs charged by Insurers, which act as centralized “guarantors".
We propose a solution to the costly central guarantor problem by using our patent pending peer-to-peer tontine pensions administered by an unbiased, mathematically robust smart-actuary which ensures that the pension is ALWAYS fully funded. And because tontine pensions provide lifetime income without requiring a guarantor, they significantly reduce the cost of providing pension benefits and thus significantly increase the income paid out to retirees.
Tontines are a 365-year-old financial innovation which successfully financed many European
countries and states as well as numerous private projects such as roads, bridges and hotels. They make periodic payouts shared among their members for as long as they live. In later years, as the number of surviving members declines, the payout per-member rises, often dramatically.
Tontines were first offered in the US in 1868 by insurance companies and they were wildly successful. Over 50% of households invested the modern equivalent of $170Bn before Insurer malpractice caused sales to halt after a 1906 investigation revealing improper uses of capital as well as tampering with the ledger of members which undermined trust in the whole process.
In the century long absence of the tontines, retirement savings rates have plummeted.
2009 saw the emergence of distributed ledger technologies for immutable financial record-keeping which creates a new form of pseudonymous trust between users based upon math.
As such, consumers can now safely and collectively self-insure the financial risks of living longer by entering into secure, low-cost peer-to-peer tontines.
This paper proposes a fully regulated peer-to-peer tontine issuing ecosystem which can offer:
• greater financial benefits payouts to the hundreds of millions of global consumers spending ~$350BN per year on retirement income solutions,
• a digital currency which incentivizes IFAs and RIAs to take no-load tontines to their clients, and
• an un-biased, self-correcting, autonomous smart-actuary which can be trusted to ensure the tontine pension is ALWAYS fully funded and always acts in the best interest of the members.
Ομιλία - Παρουσίαση:
Falco Valkenburg,Vice-Chairperson Occupational Pensions Stakeholder Group of the European Insurance and Occupational Pensions Authority, Past Chairperson of the Actuarial Association of Europe
TFJ: The Mortgage Market is Still Heading Into the WoodsJoe Morgan
"Thoughts from Joe" is a weekly news summary and commentary from Joe Morgan, CIO of SVB Asset Management, a member of SVB Financial Group and wholly owned subsidiary of Silicon Valley Bank
It is a little over 6 weeks since the UK voted to leave the EU in the most significant upset of the British political landscape since the Second World War. Both the economy and the business community in the UK, and some would say the wider European continent, have been thrown into an uncomfortable holding pattern.
Daily forex report by epic research limited of 18 may 2017Epic Research
Epic Research serves with daily reports on different segments which helps traders to quickly learn about market updates. We always aim to deliver best in class services.
The 20 largest OECD countries have a combined public pension deficit of $78 Trillion. Many large corporate pension schemes are likewise significantly underfunded.
With over 44% of men and 55% of women now expected to live into their 90s, many consumers will outlive their private savings by 5 years and some by at least 10 years.
Current retirement income products such as life annuities are unpopular due to low returns mostly caused by the high costs charged by Insurers, which act as centralized “guarantors".
We propose a solution to the costly central guarantor problem by using our patent pending peer-to-peer tontine pensions administered by an unbiased, mathematically robust smart-actuary which ensures that the pension is ALWAYS fully funded. And because tontine pensions provide lifetime income without requiring a guarantor, they significantly reduce the cost of providing pension benefits and thus significantly increase the income paid out to retirees.
Tontines are a 365-year-old financial innovation which successfully financed many European
countries and states as well as numerous private projects such as roads, bridges and hotels. They make periodic payouts shared among their members for as long as they live. In later years, as the number of surviving members declines, the payout per-member rises, often dramatically.
Tontines were first offered in the US in 1868 by insurance companies and they were wildly successful. Over 50% of households invested the modern equivalent of $170Bn before Insurer malpractice caused sales to halt after a 1906 investigation revealing improper uses of capital as well as tampering with the ledger of members which undermined trust in the whole process.
In the century long absence of the tontines, retirement savings rates have plummeted.
2009 saw the emergence of distributed ledger technologies for immutable financial record-keeping which creates a new form of pseudonymous trust between users based upon math.
As such, consumers can now safely and collectively self-insure the financial risks of living longer by entering into secure, low-cost peer-to-peer tontines.
This paper proposes a fully regulated peer-to-peer tontine issuing ecosystem which can offer:
• greater financial benefits payouts to the hundreds of millions of global consumers spending ~$350BN per year on retirement income solutions,
• a digital currency which incentivizes IFAs and RIAs to take no-load tontines to their clients, and
• an un-biased, self-correcting, autonomous smart-actuary which can be trusted to ensure the tontine pension is ALWAYS fully funded and always acts in the best interest of the members.
Ομιλία - Παρουσίαση:
Falco Valkenburg,Vice-Chairperson Occupational Pensions Stakeholder Group of the European Insurance and Occupational Pensions Authority, Past Chairperson of the Actuarial Association of Europe
TFJ: The Mortgage Market is Still Heading Into the WoodsJoe Morgan
"Thoughts from Joe" is a weekly news summary and commentary from Joe Morgan, CIO of SVB Asset Management, a member of SVB Financial Group and wholly owned subsidiary of Silicon Valley Bank
It is a little over 6 weeks since the UK voted to leave the EU in the most significant upset of the British political landscape since the Second World War. Both the economy and the business community in the UK, and some would say the wider European continent, have been thrown into an uncomfortable holding pattern.
Daily forex report by epic research limited of 18 may 2017Epic Research
Epic Research serves with daily reports on different segments which helps traders to quickly learn about market updates. We always aim to deliver best in class services.
Brexit votes in Parliament could be crucial for sterling this weekHantec Markets
It is a crucial week in the Brexit process and we look at the implications for sterling. The ECB monetary policy actions have shifted the outlook for the euro, and we consider the implications of recent moves on forex, equities and commodities.
FOMC, Advance GDP, Nonfarm Payrolls and Brexit all key this weekHantec Markets
It will be a crucial decision for the Federal Reserve this week as traders consider the prospect of a third straight rate cut. Consumer Confidence, Advance GDP and Non-farm Payrolls means that it is a jam packed week for the calendar. With Brexit uncertainty and the looming prospect of a UK general election also to impact, we are looking at a busy week for major markets and consider the outlook for forex, equities and commodities.
Brexit chaos continues with the can kicked further down the roadHantec Markets
The Brexit can has been kicked down the road for a couple of weeks at least, but we are not out of the woods yet. We look at the latest developments and the impact on markets. The increased market fear over an inverted US yield curve is impacting on the outlook for forex, equities and commodities.
With Halloween right around the corner, it's the time of year to analyse what is safe and what is scary in investment markets.
And, the scariest investments in the world will become a complete surprise to many.
In this IceCap Global Outlook we detail what to be afraid of and why, and better yet - where you should hide.
Baillieu Holst 2016 Federal Budget Breakfast PresentationDarryl Gobbett
4th May 2016 Baillieu Holst presented their views on the 2016 Federal Government Budget. CEO Gavin Powell, Chief Economist Darryl Gobbett and SMSF Specialist Helen Dundon presented the changes and the impacts of the changes announced.
Brexit votes in Parliament could be crucial for sterling this weekHantec Markets
It is a crucial week in the Brexit process and we look at the implications for sterling. The ECB monetary policy actions have shifted the outlook for the euro, and we consider the implications of recent moves on forex, equities and commodities.
FOMC, Advance GDP, Nonfarm Payrolls and Brexit all key this weekHantec Markets
It will be a crucial decision for the Federal Reserve this week as traders consider the prospect of a third straight rate cut. Consumer Confidence, Advance GDP and Non-farm Payrolls means that it is a jam packed week for the calendar. With Brexit uncertainty and the looming prospect of a UK general election also to impact, we are looking at a busy week for major markets and consider the outlook for forex, equities and commodities.
Brexit chaos continues with the can kicked further down the roadHantec Markets
The Brexit can has been kicked down the road for a couple of weeks at least, but we are not out of the woods yet. We look at the latest developments and the impact on markets. The increased market fear over an inverted US yield curve is impacting on the outlook for forex, equities and commodities.
With Halloween right around the corner, it's the time of year to analyse what is safe and what is scary in investment markets.
And, the scariest investments in the world will become a complete surprise to many.
In this IceCap Global Outlook we detail what to be afraid of and why, and better yet - where you should hide.
Baillieu Holst 2016 Federal Budget Breakfast PresentationDarryl Gobbett
4th May 2016 Baillieu Holst presented their views on the 2016 Federal Government Budget. CEO Gavin Powell, Chief Economist Darryl Gobbett and SMSF Specialist Helen Dundon presented the changes and the impacts of the changes announced.
Presentación elaborada por dos alumnos de bachillerato para acompañar una exposición sobre La Celestina y trabajar el discurso oral planificado y especializado, la investigación literaria y el estudio de la Historia de la Literatura Española.
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Client retention and the loss of hard-earned clients
In these post-RDR times, one of the biggest concerns facing many professional financial advisers is client retention and the loss of hard-earned clients to another competitor. To ensure that this doesn't happen to your business, our advice is that you need to do everything possible to stay engaged with your clients and keep reminding them about why they chose you in the first place.
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As a prosperity-minded financial advisor, it's important to guide your clients toward a prosperous retirement. Using the Income Optimization Bridge strategy, learn how to help your client optimize their retirement income. This method is good for clients at any stage in the game and bridges different income sources for a desirable retirement!
Almost all investors have seen their stock portfolios tumble sharply over the past 18 months, and many fear more troubled times ahead. Unemployment is high, the dollar is weak, and the national debt is huge and growing.
•Estate planning with your pension
•Your year end checklist: time to focus
•Buy-to-Let: a taxing issue
•Curtains for the Autumn Statement
•Your shrinking pension allowances
Our guide to Retirement Resilience is packed with a wealth of information to help you make informed choices about your pension pot, find out how you can take control and get the most out or your pension. Find out more at https://www.tudorfranklin.co.uk
On 23 June the UK public will be given what could be a once in a generation opportunity to have its say on the UK’s relationship with Europe. Whatever the result, it will have far-reaching economic and political consequences. In our latest version of LCP Vista we have explored how this could impact pension schemes.
Of course, whilst Brexit is naturally dominating the news, pension schemes need to carry on thinking about the best long-term strategies to meet their liabilities. So in this edition of LCP Vista we take a look at the latest investment ideas to help them do so.
Common Factors Affecting Retirement IncomeDolf Dunn
People have two very distinct investment periods in their lives, Accumulation and Distribution. Brokers are paid in the accumulation phase, not so much in the distribution phase. Fee-based Financial Planners, like myself, are paid along the way to give our clients great advice in both phases of their lives. Distribution phase is the more difficult of the two to get right. If you do not do proper planning, one risks running out of money before your last breathe. Not to be entrusted to amateurs. I can help, please give me a call.
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What website can I sell pi coins securely.DOT TECH
Currently there are no website or exchange that allow buying or selling of pi coins..
But you can still easily sell pi coins, by reselling it to exchanges/crypto whales interested in holding thousands of pi coins before the mainnet launch.
Who is a pi merchant?
A pi merchant is someone who buys pi coins from miners and resell to these crypto whales and holders of pi..
This is because pi network is not doing any pre-sale. The only way exchanges can get pi is by buying from miners and pi merchants stands in between the miners and the exchanges.
How can I sell my pi coins?
Selling pi coins is really easy, but first you need to migrate to mainnet wallet before you can do that. I will leave the telegram contact of my personal pi merchant to trade with.
Tele-gram.
@Pi_vendor_247
What price will pi network be listed on exchangesDOT TECH
The rate at which pi will be listed is practically unknown. But due to speculations surrounding it the predicted rate is tends to be from 30$ — 50$.
So if you are interested in selling your pi network coins at a high rate tho. Or you can't wait till the mainnet launch in 2026. You can easily trade your pi coins with a merchant.
A merchant is someone who buys pi coins from miners and resell them to Investors looking forward to hold massive quantities till mainnet launch.
I will leave the telegram contact of my personal pi vendor to trade with.
@Pi_vendor_247
how to sell pi coins on Bitmart crypto exchangeDOT TECH
Yes. Pi network coins can be exchanged but not on bitmart exchange. Because pi network is still in the enclosed mainnet. The only way pioneers are able to trade pi coins is by reselling the pi coins to pi verified merchants.
A verified merchant is someone who buys pi network coins and resell it to exchanges looking forward to hold till mainnet launch.
I will leave the telegram contact of my personal pi merchant to trade with.
@Pi_vendor_247
when will pi network coin be available on crypto exchange.DOT TECH
There is no set date for when Pi coins will enter the market.
However, the developers are working hard to get them released as soon as possible.
Once they are available, users will be able to exchange other cryptocurrencies for Pi coins on designated exchanges.
But for now the only way to sell your pi coins is through verified pi vendor.
Here is the telegram contact of my personal pi vendor
@Pi_vendor_247
Resume
• Real GDP growth slowed down due to problems with access to electricity caused by the destruction of manoeuvrable electricity generation by Russian drones and missiles.
• Exports and imports continued growing due to better logistics through the Ukrainian sea corridor and road. Polish farmers and drivers stopped blocking borders at the end of April.
• In April, both the Tax and Customs Services over-executed the revenue plan. Moreover, the NBU transferred twice the planned profit to the budget.
• The European side approved the Ukraine Plan, which the government adopted to determine indicators for the Ukraine Facility. That approval will allow Ukraine to receive a EUR 1.9 bn loan from the EU in May. At the same time, the EU provided Ukraine with a EUR 1.5 bn loan in April, as the government fulfilled five indicators under the Ukraine Plan.
• The USA has finally approved an aid package for Ukraine, which includes USD 7.8 bn of budget support; however, the conditions and timing of the assistance are still unknown.
• As in March, annual consumer inflation amounted to 3.2% yoy in April.
• At the April monetary policy meeting, the NBU again reduced the key policy rate from 14.5% to 13.5% per annum.
• Over the past four weeks, the hryvnia exchange rate has stabilized in the UAH 39-40 per USD range.
Even tho Pi network is not listed on any exchange yet.
Buying/Selling or investing in pi network coins is highly possible through the help of vendors. You can buy from vendors[ buy directly from the pi network miners and resell it]. I will leave the telegram contact of my personal vendor.
@Pi_vendor_247
Currently pi network is not tradable on binance or any other exchange because we are still in the enclosed mainnet.
Right now the only way to sell pi coins is by trading with a verified merchant.
What is a pi merchant?
A pi merchant is someone verified by pi network team and allowed to barter pi coins for goods and services.
Since pi network is not doing any pre-sale The only way exchanges like binance/huobi or crypto whales can get pi is by buying from miners. And a merchant stands in between the exchanges and the miners.
I will leave the telegram contact of my personal pi merchant. I and my friends has traded more than 6000pi coins successfully
Tele-gram
@Pi_vendor_247
Turin Startup Ecosystem 2024 - Ricerca sulle Startup e il Sistema dell'Innov...Quotidiano Piemontese
Turin Startup Ecosystem 2024
Una ricerca de il Club degli Investitori, in collaborazione con ToTeM Torino Tech Map e con il supporto della ESCP Business School e di Growth Capital
The secret way to sell pi coins effortlessly.DOT TECH
Well as we all know pi isn't launched yet. But you can still sell your pi coins effortlessly because some whales in China are interested in holding massive pi coins. And they are willing to pay good money for it. If you are interested in selling I will leave a contact for you. Just telegram this number below. I sold about 3000 pi coins to him and he paid me immediately.
Telegram: @Pi_vendor_247
how can i use my minded pi coins I need some funds.DOT TECH
If you are interested in selling your pi coins, i have a verified pi merchant, who buys pi coins and resell them to exchanges looking forward to hold till mainnet launch.
Because the core team has announced that pi network will not be doing any pre-sale. The only way exchanges like huobi, bitmart and hotbit can get pi is by buying from miners.
Now a merchant stands in between these exchanges and the miners. As a link to make transactions smooth. Because right now in the enclosed mainnet you can't sell pi coins your self. You need the help of a merchant,
i will leave the telegram contact of my personal pi merchant below. 👇 I and my friends has traded more than 3000pi coins with him successfully.
@Pi_vendor_247
how can i use my minded pi coins I need some funds.
PWM Financial Focus Autumn 2016
1. Autumn2016
Brexit fallout: what are the
implications
In this issue:
About to draw your pension benefits?
Single-tier pension blues
Inheritance tax: the silent tax collector
Can you take the risk?
3. Autumn 2016 3
About to draw your pension
benefits?
If you are going to turn your pension fund into a retirement income
in the near future, the outcome of the EU referendum has complicated
matters.
One of the reasons George Osborne gave for the introduction of
his radical pension flexibility reforms in March 2014 was that “the
annuities market is currently not working in the best interests of
all consumers.” Yet the annuity rates of spring 2014 now look a
bargain: by mid-June 2016 typical rates were around 15% lower
than when the then Chancellor spoke. Rates have fallen further
since, as a result of the Brexit vote driving down bond yields.
If you are at the stage of converting your pension fund into a
retirement income, you may feel circumstances are conspiring
against you. In fact, the new pension regime has given you more
flexibility in how you can draw your benefits. This might not be
immediately obvious because some pension providers do not offer
full flexibility on their older pension arrangements. If you want
to take advantage of more options than are available from your
current provider, it is usually a reasonably straightforward matter to
transfer to a new arrangement with greater flexibility.
Draw down
Under the new pension flexibility you can draw down part (or
even the whole) of your pension fund as a lump sum, with 25%
normally free of tax and the balance subject to income tax. Any
undrawn portion remains invested and can be used to pay out
more at a later date. Depending on your circumstances, you could
use a series of payments to provide a stream of tax-efficient
income. At a time when investment markets are volatile, it
can make sense to draw from your pension plan only
what you need and avoid making a large one-off sale
and reinvestment, as would be the case with an
outright annuity purchase.
Choose carefully
The so-called ‘drawdown’ approach is not
right for everyone – you may want some
guarantees built into your future income
which drawing funds straight from you
pension fund cannot supply. The key
point is to work out what net income
you require from your pension fund
and then take advice on the ways in
which this can be achieved. Sometimes
a combination of methods may be
appropriate. For instance, you may use
part of your fund to buy an annuity giving
you a basic level of guaranteed income; and
then you could invest the remainder in funds from which you draw
regularly or as needs arise.
This is an area in which individual, expert advice is essential.
Choosing the wrong option can create some large tax bills or leave
you locked into a poor value solution for the rest of your life. That
can be a long time spent in regret: the average 65 year old has at
least a one in four chance of reaching the age of 94.
The value of your investment can go down as well as up and you
may not get back the full amount you invested. Past performance
is not a reliable indicator of future performance. Investing in shares
should be regarded as a long-term investment and should fit in
with your overall attitude to risk and financial circumstances.
“ Under the new pension flexibility
you can draw down part (or even the whole)
of your pension fund as a lump sum, with
25% normally free of tax and the balance
subject to income tax.”
4. Financial risk needs a different reaction
Human evolution has made us instinctively averse to uncertainty
and this is especially true in the financial markets, according to
Professor Andrew Lo of MIT’s Sloane School of Management. Dr Lo
has said that our natural reaction to physical risk – what has been
described as ‘fight or flight’ – may save our lives, but that the same
reaction to financial markets tends to make us short-term investors
and so miss out on the benefits that long-term investing can bring.
UK investors who moved into cash ahead of the Brexit results
on 24 June will have seen the FTSE100 make a remarkable and
unexpected climb of around 6% in the following month, leaving
them well out of pocket. From a historical perspective we can
see the dangers of moving out of the markets when the outlook
seemed bleak. Investors who moved into cash in March 2003
or March 2009 risked missing out on a double digit rise in the
FTSE100 within the following few months.
Duller growth is likely
The UK economy will be impacted by Brexit and uncertainty as
to how this will show itself will prevail for some time. Cazenove
Capital’s Chief Investment Officer, Richard Jeffrey, has said
“Whatever the long term may bring for the UK, it is hard not to
conclude the UK economy will see duller growth for a couple of
years, though quantifying ‘duller’ is impossible at the moment.”
Is there a safe haven?
For some investors the solution will be to leave their money in
cash, but as we have seen this has dangers as markets can move
upwards very quickly. Inflation will also reduce the buying power
of your capital over time. Many investors have been lured by the so
called ‘safe haven’ of gold as the price spiked following Brexit. But
gold has its risks too and its value in the first quarter of 2016 was
down on three years ago.
4 Autumn 2016
The implications for investors of the result of the UK referendum on
EU membership will be played out over the months ahead and it is
very likely that volatility will persist in the near term. Although we
understand investors’ concerns, you should not need to make dramatic
changes, provided you have a well-diversified portfolio.
Brexit fallout: what are
the implications?
5. The best solution for investors
The answer to unexpected events like the Brexit result and the
subsequent ups and downs of stock markets is to invest for the
long term and to diversify. Investing for the long term means not
panicking and bailing out when investments fall. And diversifying
means spreading your investments – not putting all your
investment eggs in one basket.
Diversification will help protect your investments from the full
impact of the volatility of the UK stock market. What’s more, with
the pound falling against other currencies, it means that your
overseas investments produce an additional benefit for you when
they are converted into sterling.
Your investments should not just consist of equities – that is share-
based investments. Lower risk portfolios may have a quarter or
more of the portfolio made up of fixed interest investments. It is
often the case that when shares fall, as they did immediately after
the Brexit vote, bonds – especially government bonds like gilts –
rise in value. It doesn’t always happen like that, although bonds
tend to be less volatile than shares.
Most people’s instinctive reaction to any kind of danger is often
flight. But as we’ve seen, that could be an expensive mistake.
The value of your investment can go down as well as up and you
may not get back the full amount you invested. Past performance
is not a reliable indicator of future performance. Investing in shares
should be regarded as a long-term investment and should fit in
with your overall attitude to risk and financial circumstances.
Autumn 2016 5
“ Most people’s instinctive
reaction to any kind of danger is
often flight. But that could often
be an expensive mistake.”
Do you run a business as a partnership or company along with other shareholder-directors? If so, have you considered what would happen
if one of your fellow business owners was struck by a serious illness or died? You could find yourself having to accept a new – and unknown
– partner/shareholder or even having to sell up at the worst moment. The key to avoiding such a situation is to have cash and the correct
structure of agreement to buy out your colleague’s business interest. If you already have one in place, make sure it is regularly reviewed,
as values change.
A business loss you may not have considered
6. Single-tier pension blues
The Department for Work and Pensions is sending out bad news to over
100,000 people.
The new single-tier state pension started life in April 2016, marking
the end of the basic state pension and the state second pension
for anyone who had not already reached their state pension age
(SPA). In the run up to the launch, the government publicity placed
considerable emphasis on the amount of the new single-tier
pension (£155.65 a week in 2016/17), which is £36.35 a week
more than the current basic state pension. However, while the
£155 succeeded in grabbing the headlines, it is far from the whole
story, as is now becoming clear.
Earlier this year the House of Commons Work and Pensions Select
Committee examined the “communication of the new state
pension” and was critical of the emphasis placed on the £155.65
figure. The Committee echoed a crucial point made by many
pension professionals for some time: in the early years of transition
to the new system “the majority will not” receive the full amount.
Even by 2030, almost one in five of those
reaching their SPA will receive
less than 100%.
Lower pensions
There are three groups in particular who stand to suffer most in
the early years, because they could end up receiving less under the
single-tier system than they would have got under the old regime,
it it had continued:
1. If you have a National Insurance contribution/credit
record of fewer than 10 years by the time you reach your
SPA, then you will receive nothing from the single-tier pension
regime. Under the old system, you started building up a pension
after just one complete year of contributions. The Department
for Work and Pensions has recently announced that it will be
writing to over 100,000 people warning them that they will get
no pension whatsoever because of this new 10-year rule.
2. If your old regime pension entitlement relied upon your
spouse’s National Insurance contribution record, then
this is no longer available to you if your SPA is after 5 April
2016. The basis of the single-tier pension is strictly personal,
both in terms of contribution record and benefits – there are
no widow(er)’s pensions, other than in limited transitional
circumstances.
3. If you were a member of a contracted out final salary
scheme between 1978/79 and 1987/88, you would have
accrued Guaranteed Minimum Pension (GMP) in place of SERPS.
Under the old regime, the state provided full inflation-proofing
for GMP from SPA – your employer provided none. While this
pattern continues to apply for those who reached their SPA by
5 April 2016, there will be no state-funded increases if your
SPA is later. A similar, though potentially much smaller loss
occurs for contracted out scheme membership between
1988/89 and 1996/97. The employer is required to
provide up to 3% inflation protection for GMP earned in
that period with the state (formerly) responsible for any
excess.
These cuts in pension benefits stem from deliberate
government decisions made in dealing with the
complexities of switching from the old to the new
regime. In theory the reductions could have been
avoided by specially targeted transitional measures
for those affected, but this would have added to
overall costs, which the government wanted to keep
unchanged at worst.
The best way to find out your single-tier pension
entitlement is to obtain a projection from the Department
for Work and Pensions website (www.gov.uk/check-state-
pension), which will also tell you when you reach your SPA – it
may not be when you think! Once you have got the projection,
your next step should be to talk to us about your retirement
options.
6 Autumn 2016
7. Inheritance tax: the silent tax
collector
The government’s receipts from
inheritance tax (IHT) have been
rising much faster than the yield
from other taxes.
In a recent report on the changing nature of UK tax revenues, the
Institute for Fiscal Studies (IFS) noted that “There is an increased
reliance on smaller taxes”. It attributed this shift to the political
difficulties in raising rates on the major taxes, such as VAT, fuel
duty and income tax.
IHT is a good example of one of the “smaller taxes” that is quietly
producing an increasing slice of the total tax take, as the chart
below clearly shows. In 2016/17, IHT is projected to raise almost
£5bn, more than double what it produced in 2009/10. There are
many reasons why the Treasury’s IHT income is outpacing the
growth in overall revenue, but the most significant is probably the
freezing since April 2009 of the nil rate band – broadly speaking
the amount of your estate (after any exemptions) not subject to
tax at a flat rate of 40%.
Average UK house prices have risen by more than 30% so far over
the period that the nil rate band has been frozen, according to
Nationwide. In Greater London the increase exceeds 85%. It’s true
that the government is introducing a main residence nil rate band
(RNRB) in April 2017, initially at £100,000, rising to £175,000 by
April 2020, but this will be of little or no help to some people.
The RNRB has also been criticised by the chairman of the
Treasury Select Committee who said it failed to meet any of three
requirements that: “Tax rules should aim to be simple, fair and
clear”. While the RNRB is being phased in, the ordinary nil rate
band will continue to be frozen, meaning its first increase above
the 2009 figure of £325,000 will not occur until at least April
2021. The net result is that the government’s revenue from IHT is
still forecast to rise over the period that the RNRB is introduced,
according to the Office for Budgetary Responsibility.
If you do not want the Exchequer to be a major – or even the
largest – beneficiary of your estate, then the sooner you begin
planning, the better. The starting point is making sure your wills
are up to date – or putting in place a will if you are currently
relying on the vagaries of intestacy law. Once the structure of
your will is settled, there are no simple rules of thumb for the next
stage, other than to take expert advice.
Estate planning requires a clear, holistic approach and needs to be
integrated with other aspects of your personal financial planning.
For example, from an IHT viewpoint your pension plans may not be
the wisest way of providing retirement income.
The value of tax reliefs depends on your individual circumstances.
Tax laws can change. The Financial Conduct Authority does not
regulate tax advice or will writing.
200
180
160
140
120
100
2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16
The Rise of Inheritance Tax
Base 2009/10 = 100
IHT receipts Total Tax Receipts
Autumn 2016 7
8. Partners Wealth Management LLP
16 Old Bailey
London
EC4M 7EG
Tel: 0207 444 4030
Fax: 020 7444 4031
Email: info@pwmllp.co.uk
www.partnerswealthmanagement.co.uk
Partners Wealth Management LLP is authorised
and regulated by the Financial Conduct Authority
8 Autumn 2016
The UK has experienced its fair share of political risk
recently. Following the decision to leave the institution
that has been a core part of our economic and political
lives in one form or another for 43 years, we have also
seen a change of Prime Minister in mid-term and a vote of
no confidence in the leader of the main opposition party.
On a national level, that’s a lot of risk.
No one wishes to lose money on their investments, but
most people are aware that for additional gain there is
almost always increased risk. Understanding your attitude
to risk and capacity to absorb loss is key to investment
planning.
The process of establishing your attitude to risk will start
with you completing a risk questionnaire. A psychometric
questionnaire can be a good way to check how you
view investment risk. That’s usually a starting point for
discussion of the nature of investment risk and your
attitude to it. The extent to which you are prepared
to take on investment risk could range from being
exceedingly cautious, through being prepared to consider
a moderate degree of risk to being adventurous in your
approach.
But it is also important to consider what is called your
Can you take the risk?
The outcome of the EU referendum was a reminder that risk comes in
many forms, including political risk.
The latest report from the Pensions Regulator shows that as automatic enrolment spreads through smaller employers, warnings and fines
for ‘non-compliance’ are soaring. In the second quarter of 2016 the regulator issued nearly 3,400 compliance notices, more than 850 fixed
penalty notices of £400 a piece and nearly 38 escalating penalty notices (which can be as high as £10,000 a day). Make sure you are prepared
for your employer responsibilities or you could be adding to those numbers in the future.
Auto-enrolment: the fines continue to grow
‘capacity for loss’ – how much risk you can afford to take. This is the
degree to which your personal circumstances and opinions will have
an impact on the specific investment recommendations. For instance,
an investor may be willing to buy very risky investments but may
have limited resources and a very short-term goal – for example to
build up enough capital to pay for their children’s school fees starting
in four years’ time. Their need to avoid risk because of their short time
scale and modest means should outweigh their willingness to buy
risky investments.
If you are having second thoughts about the basis of your investment
approach, please ask us for a new risk review.