Pension forecasts fraught with smoke and mirrors?
No wonder back in 2004 the Pensions Commission report stated that the UK “has the most complex pension system in the whole world”. Well of course A-Day was supposed to have changed all of that - but hmmm, the jury may still be out on that one. When it comes to forecasting or even understanding their pensions there’s still a fair lot of smoke and mirrors folks need to cut through yet. I was discussing pension issues with Steve Bee, UK Pensions Expert at a recent Scottish Life seminar in Dundee…
and upon my return was amused but not surprised that one of Steve’s subscribers (you have to check Steve’s site out by the way - it’s required reading) had picked up on the fact that changes to the Alternatively Secured Pensions (ASP) which came into effect in April 2007 had not been updated in the online Registered Pension Schemes Manual (RPSM) which is the authority when it comes to all things pension… and yes, it’s still v.complex despite A-Day.
That’s a whole whopping 8 months lag time. Sure enough though, as soon as Steve shouted about it, the HMRC updated their online manual - nothing like a little close adverse publicity to inspire performance!
The least said about HMRC’s latest performance regarding the loss of data for 25 million Child Benefit accounts the better, it just makes one a little nervous around these folk when they clearly sometimes can’t even find their own tails. Remember, these are the guys trusted to get it right with information to help people make the right choices about their retirement finances.
So in the spirit of trying to bring a little calm into the equation I thought I’d post you two pension resources which should help you cut through the pensions clutter and noise and bring you some clarity as a starting point.
1. First off is the FSA Pension Calculator and it’s where everyone should start. (If my memory serves me correctly it was also down for a while earlier on this year actually). Anyhow you need an accurate as possible snapshot of what your pension is likely to be when you retire. You can then plan to make up any shortfalls required to keep you on target.
Here’s the link - Pension Calculator
2. The second is actually a bumper download of six important publications from the FSA ‘Money Made Clear’ website which are very good. They are as follows - Retiring soon? Retirement options. Stakeholder pensions and decision trees. The State Second Pension – should you be contracted out? Pension transfers – the risks of salary-related occupational pension transfers. Important information about your yearly pension statement.
You can download the entire six PDFs in one zip file here. Simple click the link below and save it to your hard drive where you can open it with free unzip software such as… camunzip if you don’t have such software on your PC.
Here’s the link for you. Pension Planning PDFs(Please be patient on if on a slower connection.)
That will give you enough food for thought just now. I’ll post more over time that I think will be useful on various topics.
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