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What was in the weekend’s papers? (30/11/2020)

Category: News

Philip Green urged to plug pension gap before Arcadia administration

Sir Philip Green is under pressure to use his wealth to make up the “huge shortfall” in the Arcadia’s pension scheme. This takes place as the group is expected to enter administration, writes The GuardianThousands of workers’ pensions could fall by 10% if the Pension Protection Fund takes over Arcadia’s final salary scheme. The BHS pension scheme had a £571m pension deficit when Sir Phillip Green sold it for £1 to Dominic Chappell in 2016. Green then paid £353m to help support the scheme.

This shows how a final salary scheme is only fully guaranteed for as long as the sponsoring employer is capable and willing to support it. The Pension Protection Fund is a highly valuable backstop. However, members of schemes taken over by the PPF may find the amount they will receive in retirement, and the amount it will increase each year has reduced significantly.

How a cheaper pension will last you an extra 16 years

According to The Sunday Times savers could £128,000 better off, meaning a pension pot that last 16 years longer, by using Vanguard’s new drawdown product.

One of our roles as advisers is to ensure that our clients are getting a good deal with the financial products they utilise. When looking at this we do not just take charges into account. We take other factors such as investment flexibility, features and service into account. We look at this regularly to adapt to an ever-changing marketplace.

Annuity rates ‘worse than ever’ – here are the alternatives to fixed income

Annuity rates have fallen so much that buyers are unlikely to get their whole investment back, writes The Telegraph. It assesses the options retirees have and suggests combining buying an annuity with drawdown.

When looking at the best options for our clients we will look at making the income covering the essentials, bills etc, as secure as possible. Annuities are not the only way to go about this, but we always consider them.

If you want to have a chat about anything, feel free to book in a free no-obligation chat here or get in touch.

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