logging in or signing up Ritchie B06 presentation Amateur Download Post to : URL : Related Presentations : Share Add to Flag Embed Email Send to Blogs and Networks Add to Channel Uploaded from authorPOINT Insert YouTube videos in PowerPont slides with aS Desktop Copy embed code: (To copy code, click on the text box) Embed: URL: Thumbnail: WordPress Embed Customize Embed The presentation is successfully added In Your Favorites. Views: 27 Category: News & Reports.. License: All Rights Reserved Like it (0) Dislike it (0) Added: August 27, 2007 This Presentation is Public Favorites: 0 Presentation Description No description available. Comments Posting comment... Premium member Presentation Transcript 2002 PENSIONS CONVENTION: 2002 PENSIONS CONVENTION Statutory Money Purchase Illustrations (SMPI) Stewart Ritchie SMPI: SMPI The NAPF presentation Some further detail Content: Content What SMPI is When it applies and when it doesn’t Implications What SMPI is (1): What SMPI is (1) ‘Tony’s dream’ Money purchase annual benefit statements Today From 6 April 2003 Must illustrate, and… On a standard basis What SMPI is (2): What SMPI is (2) The basis assumes: An RPI-linked annuity 50% spouse pension if married Up-to-date mortality What SMPI is (3): What SMPI is (3) The answer is expressed: In today’s money As a single figure It is approximate It is not a replacement for advice When SMPI Applies (1): When SMPI Applies (1) When an annual benefit statement is already required for a money purchase benefit. When SMPI Applies (2) - Examples: When SMPI Applies (2) - Examples Contracted in/out money purchase occupational schemes (CIMP/COMP) Stakeholder pensions Group personal pensions (GPP) Self invested personal pensions (SIPPs) Individual personal pensions Money purchase AVCs (in-house or free standing) Trustee-proposed money purchase section 32 buyout plans When SMPI Does Not Apply - Examples: When SMPI Does Not Apply - Examples ‘Section 226’ retirement annuities ‘Old code’ pensions SSASs where all members are trustees Individually proposed money purchase S32 Hybrid schemes where the money purchase underpin won’t bite ‘De-minimis’ (£5000) level, if no contributions Implications (1): Implications (1) Significant costs and time pressure for providers The words will be as important as the numbers Volatility from year to year 'Shock horror' first time round? Implications (2): Implications (2) 'Shock horror' likely if recipient not used to real terms projections For example, if provider is FSA regulated Less likely if bespoke actuarial advice Implications (3) Possible Reactions: Implications (3) Possible Reactions Ignore Think its wonderful (unlikely) 'I’ll sue you' 'If that’s all I’ll get, why bother?' 'Please talk me through it' Implications (4): Implications (4) Harder for employers to play down the implications of DB DC Increased demand for individual advice? Some Further Detail: Some Further Detail About the basis Examples About The Basis: About The Basis Best estimate To be kept under review Double entry mortality Own expenses Examples (1): Examples (1) Male aged 21, paying £20 pm, retiring age 60 Current middle FSA P.o.S : £2790 pa SMPI : £645 pa Examples (2): Examples (2) Male aged 62, fund £350,000, paying 10% of £25k salary, retiring at 65 Current middle FSA P.o.S : £34,200 pa SMPI : £21,400 pa CONCLUSION: CONCLUSION You do not have the permission to view this presentation. In order to view it, please contact the author of the presentation.
Ritchie B06 presentation Amateur Download Post to : URL : Related Presentations : Share Add to Flag Embed Email Send to Blogs and Networks Add to Channel Uploaded from authorPOINT Insert YouTube videos in PowerPont slides with aS Desktop Copy embed code: (To copy code, click on the text box) Embed: URL: Thumbnail: WordPress Embed Customize Embed The presentation is successfully added In Your Favorites. Views: 27 Category: News & Reports.. License: All Rights Reserved Like it (0) Dislike it (0) Added: August 27, 2007 This Presentation is Public Favorites: 0 Presentation Description No description available. Comments Posting comment... Premium member Presentation Transcript 2002 PENSIONS CONVENTION: 2002 PENSIONS CONVENTION Statutory Money Purchase Illustrations (SMPI) Stewart Ritchie SMPI: SMPI The NAPF presentation Some further detail Content: Content What SMPI is When it applies and when it doesn’t Implications What SMPI is (1): What SMPI is (1) ‘Tony’s dream’ Money purchase annual benefit statements Today From 6 April 2003 Must illustrate, and… On a standard basis What SMPI is (2): What SMPI is (2) The basis assumes: An RPI-linked annuity 50% spouse pension if married Up-to-date mortality What SMPI is (3): What SMPI is (3) The answer is expressed: In today’s money As a single figure It is approximate It is not a replacement for advice When SMPI Applies (1): When SMPI Applies (1) When an annual benefit statement is already required for a money purchase benefit. When SMPI Applies (2) - Examples: When SMPI Applies (2) - Examples Contracted in/out money purchase occupational schemes (CIMP/COMP) Stakeholder pensions Group personal pensions (GPP) Self invested personal pensions (SIPPs) Individual personal pensions Money purchase AVCs (in-house or free standing) Trustee-proposed money purchase section 32 buyout plans When SMPI Does Not Apply - Examples: When SMPI Does Not Apply - Examples ‘Section 226’ retirement annuities ‘Old code’ pensions SSASs where all members are trustees Individually proposed money purchase S32 Hybrid schemes where the money purchase underpin won’t bite ‘De-minimis’ (£5000) level, if no contributions Implications (1): Implications (1) Significant costs and time pressure for providers The words will be as important as the numbers Volatility from year to year 'Shock horror' first time round? Implications (2): Implications (2) 'Shock horror' likely if recipient not used to real terms projections For example, if provider is FSA regulated Less likely if bespoke actuarial advice Implications (3) Possible Reactions: Implications (3) Possible Reactions Ignore Think its wonderful (unlikely) 'I’ll sue you' 'If that’s all I’ll get, why bother?' 'Please talk me through it' Implications (4): Implications (4) Harder for employers to play down the implications of DB DC Increased demand for individual advice? Some Further Detail: Some Further Detail About the basis Examples About The Basis: About The Basis Best estimate To be kept under review Double entry mortality Own expenses Examples (1): Examples (1) Male aged 21, paying £20 pm, retiring age 60 Current middle FSA P.o.S : £2790 pa SMPI : £645 pa Examples (2): Examples (2) Male aged 62, fund £350,000, paying 10% of £25k salary, retiring at 65 Current middle FSA P.o.S : £34,200 pa SMPI : £21,400 pa CONCLUSION: CONCLUSION