Andrew – Property Company
“I felt really fortunate to have a pension but at same time I was worried about the state of the economy. My employer had been making a lot of redundancies and I’d lost my confidence the company pension scheme. I found pension jargon a nightmare and needed someone I could trust who would help me decide what to do.
57 year old Andrew is an executive in a large property development and management company and a member of their final salary pension scheme which closed in 2006. What once appeared to be a ‘gold plated’ pension, like many other FTSE 100 company schemes, now had a huge question mark over its dependability.
In 2011, his Pension Statement showed a ‘hole in the pot’. The word ‘guaranteed’ could no longer be relied upon. If Andrew’s pension scheme got into difficulty his ‘guaranteed’ £21,695 per annum would fall to £19,500 pa if taken over by the Pension Protection Fund or just £15,600 pa if it went into wind up.
What we did
We translated the complexity of his situation into a clear path to follow, avoiding undue tax penalties. As much as possible of Andrew’s pension capital was preserved for his benefit in his lifetime and for his wife’s benefit in the event of his death.
His fund is now monitored on our wealth tracking system, which gives Andrew the confidence his money is being proactively managed.
- Pension of £35,165 per annum compared to £27,045 pa if he stayed in the company scheme.
- On death, more than doubled the lump sum due to his wife – £596,000 compared to £238,000.
- Plus, on death, pension to wife of £29,800 pa compared to £13,522 pa.
- Flexibility to increase, decrease or cease pension income at any time subject to scheme limits.
- Flexibility to access his resource without penalty by taking a cash lump sum.
- Legacy worth between £ ¼ million and £½ million can be left to children. There would be no such legacy if he stayed in his company scheme.
Note: The events and figures quoted in this case study are from a real Trentham Invest client; however, the names have been changed to protect client confidentiality.