March 2019

29Mar

Lessons From the UK’s Retirement Plan Auto Enrollment Requirement

The United Kingdom has recently completed a nationwide phased rollout of a requirement that employers automatically enroll employees into a retirement plan, with the ability to opt out, and researchers from the Center for Retirement Research at Boston College say the results provide lessons for the United States. Following the UK’s initiative, participation rates have jumped to around 90% at medium and large employers (those with 58 or more workers), 74% at employers with 50 to 57 employees, 67%...

March 29, 2019
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28Mar

How 75,000 people can get a 20pc pension boost by waiting just two weeks

Changes to income tax take effect in two weeks – and with some smart use of pension pots you can save thousands of pounds in tax. The trick is to delay usual payments – using the flexibilities afforded by the pension freedom reforms – until 6 April. Both the personal allowance (the amount you can earn before paying any tax) and the level that higher-rate (40pc) tax kicks in are increasing for the 2019-20 tax year. That means earnings...

March 28, 2019
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27Mar

UK. How will new ‘collective’ pensions work? Royal Mail to pioneer a scheme that shares risks – but slashes income if things go wrong

The Government has approved a new type of 'collective' pension scheme, where workers share investment risks in the hope of gaining more certainty over payouts in retirement. Pensions won't be guaranteed - retirees could see their income rise or fall from year to year - which makes them insecure compared with traditional final salary pensions. But schemes will be designed to give stronger protections than modern defined contribution pensions, where individual workers bear all investment risks when building pensions...

March 27, 2019
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26Mar

UK Proposal Would Make Pension Mismanagement a Crime

Aproposal by the U.K. government to increase penalties and impose up to seven years in jail for bosses who recklessly risk pensions might prompt more employers to offer defined-contribution retirement plans instead of defined-benefits plans. "Overall, the proposal seems likely to make defined-benefits plans even more disfavored," said David Powell, an attorney with Groom Law Group in Washington, D.C. The proposed criminal offenses may make it more difficult for pension schemes to recruit trustees, he noted. If a plan...

March 26, 2019
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26Mar

UK. Over a million pensions face 55% tax timebomb

The pension pots of around 290,000 UK workers have already surpassed the Lifetime Allowance (LTA), meaning that they could face a hefty tax on any additional retirements savings. In addition to those already past the point of no return, research by mutual insurer Royal London has revealed that there are around 1.25 million people at risk of breaching the LTA by the time they retire. This is because senior and well-paid employees with defined benefit or defined contribution pension...

March 26, 2019
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22Mar

UK Pensions Secretary Backs Collective Defined Contribution Plans

Amber Rudd said new type of pension should ‘deliver improved investment returns.’ The UK’s Work and Pensions Secretary Amber Rudd said she supports allowing Collective Defined Contribution (CDC) pension plans in the UK, a decision that was welcomed by postal services provider Royal Mail and the Communication Workers Union (CWU). “These pioneering proposals should deliver improved investment returns for workers and savers while cutting costs and red tape for British job creators,” said Rudd. “The new type of pension...

March 22, 2019
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22Mar

UK. Up To Three Million Self-Employed Workers Turning Their Backs On Pension Pots

Data from accountancy practice Nixon Williams shines a light on the vast numbers of contractors and freelancers snubbing personal pension schemes Study finds the number opting to avoid pension scheme payments has risen 12 per cent in a single year, as the Taylor Review sparks calls for a new auto-enrolment option for self-employed workers. Almost two-thirds (64 per cent) of self-employed people in the UK are avoiding paying money into a personal pension scheme to save for their retirement,...

March 22, 2019
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21Mar

Fund managers turn up heat on UK companies over diversity, pensions, audit

Britain’s big public companies will face a grilling by asset managers over their track record on diversity, excessive pension payouts to bosses and poor quality audits when they hold annual shareholder meetings over the coming weeks. A committee of 15 asset managers at the Investment Association has picked the three issues that annoy investors the most to try to increase pressure for change. It is the first time the IA has specifically set out what changes it wants to...

March 21, 2019
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20Mar

What Japan Can Teach Us About The Opportunities Of An Ageing Society

Prime Minister Abe’s recent visit to the UK was a chance for the two countries to talk about common issues affecting their future. Let’s hope one of the topics they discussed was how to deal with an ageing society. In the 1970s and 1980s the world looked to Japan to learn about lean manufacturing. After the 2007-8 global financial crisis it looked to Japan to see how to deal with the aftermath of a financial crisis. Japan is a...

March 20, 2019
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19Mar

New pension comparison app set to launch

Age Wage, a new defined contribution comparison service, is expected to be up and running in June this year. The fintech company, which will soon enter the Financial Conduct Authority sandbox, will be launching an app which will allow savers to receive a score for their pension, and switch to another provider if they’re not happy with their results. Through an app, savers will be able to see the value of their pot, how it compares to a benchmark,...

March 19, 2019
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