1. OCCUPATIONAL PENSION
SCHEMES...1 Issue 3 September 2010
RECOMMENDATIONS ..... 2
PENSION UPDATE .......... 3
Acrossspectrum
the
Occupational Pension Schemes
Many clients have been asking if they should 3. Personal Contributions are tax
join their company pension schemes. There are deductible up to €1,200 per year.
of course many factors to take into 4. Benefits are tax free as a lump
consideration and the answer can vary
depending on your own circumstances, such sum or life annuity (subject to
as: residency).
5. Benefits can be taken between 60
1. How long you plan to stay in & 65.
Luxembourg? 6. Usually carries a Death in Service
2. Does your company offer to match benefit.
your monthly contribution?
3. Do you want to wait until you are 60 As you can see here there are many reasons
or 65 to receive your benefits? to take up one of these schemes, however,
4. Could you lose some of your benefits you need to be aware that this should not be
where you stop with your savings planning
if you change company within a for the future.
certain time period?
If you were to save €2,400 per year for 10
Generally you should consult the scheme years, at maturity you would have
administrator at your company first to find out. approximately €28,000, (assuming a net 3%
However in general it is recommended that if growth). Using an income rate of 5% as an
your company offer to match your example you could perhaps yield an income
contributions then generally it would be a good of €1,400 per year.
idea to join this scheme, reasons being:
Whilst this is of course a nice little benefit, it
really won’t make a significant impact
1. If your company matches your
during retirement.
€1,200 contribution per year then
you are guaranteed to double your This is where we currently help our existing
investment, assuming your clients save from as little as €200 per month
investment selection carries zero up to €5,000+ per month in a cost and tax
risk. efficient manner with access to many large
2. Funding of the plan is not taxed as a fund houses, including HSBC, Investec,
Jupiter, M&G and Fidelity to name but a
Benefit in Kind.
few.
Someone wishing to produce an additional income of €15,000 per annum for their retirement from the
age of 65, (depending on their age now), would have to save the following amounts, (based on a 5% net
return per annum).
Age 35 now: 532.26 per month
Age 40 now: 649.96 per month
Age 45 now: 832.02 per month

2. Pension Update Your no-
obligation
pension report
As you are probably aware system in the next 10
France have extremely months.”
strong trade unions and will
oppose this change very As we stated during our
strongly and have already pension presentations,
invoked strike action. changes are really on the
horizon and the earlier you
However such is the problem react to reduce your reliance
of the state pension system in on the state the easier these
France that Nicholas Sarkozy changes will be for you.
There have been many articles has little choice even though
about the French Government this could cause problems for To discuss any matters raised
recently and the fact that they his re-election battle in 2012. If you are interested on a
in this newsletter, please feel
have unveiled plans to raise the personal basis in exactly what
free to contact me at any
retirement age from 60 to 62 in a Although not specific to you will receive in retirement
time to arrange a no
sweeping overhaul of the Luxembourg this really then please send an email to:
obligation meeting.
pension system. michael.doyle@spectrum-
shows that pension reform is
ifa.com and I will contact you
sweeping across Europe.
Although this of course is does to arrange a meeting on an
not directly affect our state Luc Frieden, the finance individual basis and offer you
pension system in Luxembourg, minister was quoted, (in May a no obligation report, which
it really does show the pressure this year), as saying: shows you the earliest age
that Governments are under to you can retire and also what
make changes to their pension “I strongly hope to carry out your benefits will be if you
systems. decide to work until 65.
a reform of the pension
Michael Doyle
michael.doyle@spectrum-ifa.com
+352 691 128 026
TSG Insurance Services S.A.R.L. (Luxembourg Branch)
RCS Luxembourg: B 95136 - 11, avenue Guillaume, L-1651 Luxembourg.
TSG Insurance Services S.A.R.L.
Siège Social: 34 Bd des Italiens, 75009 Paris
« Société de Courtage d'assurances » R.C.S. Paris B 447 609 108 (2003B04384)
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