I guess the moment I heard the news on the scrapping of compulsory annuities will stick in the memory like the moment I heard of the death of Elvis/Lennon and Princess Di.
All morning we’d heard the helicopters hovering over Westminster, winching in George Osborne’s rabbit. Lapinologists speculated on the colour of the rabbit but nobody guessed it. I had a dream that annuities were no more and wrote a blog yesterday about what fund management would look like without annuities . I also left a cutting on my colleagues desk as I left for London from Professional Pensions Buzz survey that showed the majority of respondents wanted financial guidance at retirement (not product advice from an IFA),
I looked into the mirror this morning to check that my head hadn’t turned into a crystal ball, thankfully it hasn’t as I am on the radio in a few minutes to “rabbit” on about what all this will mean and am speaking this morning at Payroll World and this afternoon at the CIPP Capacity Crunch meeting. This evening I’m up for an award so I’m wearing a new suit and an ironed shirt (first time for everything).
Enough of this; why am I dancing on the grave of compulsory annuities. I have 3bn reasons! That’s the amount in pounds wiped off UK insurers by the market. If you want to get the story straight get odds from a book maker or prices from the stock market (closely aligned)!
The £3bn represents the asymmetry between what people had to do (buy an annuity) and what the market thinks people want to do (not buy an annuity) and it’s calculated as the lost profit to insurers as a result of them having to make do with other savings products rather than profit from compulsory annuitisation (aka seal-clubbing).
To use short words- the rip-off is over, no more ,dead ,kaput etc.
But it’s much better than that; the Chancellor (God bless his little Pauline nuts) has had the balls to put £20m of public money on the line to help pension providers and the trustees of occupational schemes explain retirement options to those stopping work in the next twelve months and extending the obligation to provide guidance beyond then.
The transitional rules between March 27th and April of next year are quite complicated so this is smart of him. It begs the question who will do the work- presumably some of the people in insurance companies who previous had to count the pound notes from annuity “sales” – ok- a bit harsh!
But there are some really interesting opportunities for people coming up and you’ll be hearing a lot from the likes of Martin Lewis and even the Pension Plowman about how you will be able to draw all your cash tax free- especially if you are about to become a low income pensioner and have a typical DC pot.
I’m looking forward to exploring the opportunity of investing in additional basic state pension using Class 3A National Insurance contributions, of buying the new Pension Bonds, of reorganising my ISAs and using my new pension saving tax allowances. All good- but as nothing to the prospect of talking to employers,trustees and my mates about how they can use their personal pensions.
Infact there are so many opportunities that I am not even going to begin now, I’m on air in 15 minutes but I’ll sign off by reminding myself of the when and where
I read about the death of annuities on a tube train travelling from Hammersmith to Liverpool St – I read it on my Mac Air tethered to my iphone, from a tweet from Jonathan Stapleton and I nearly fell off my seat.
Oh brave new world that has such pensions in it.
This post first appeared in http://www.henrytapper.com
If the support is not good, then their services won’t be good
either. Or, will we say that $12,000 car is also affordable and I won’t feel any worries, but since
the other one is cheaper, I will simply go with it and still save a couple of
thousand dollars. A toner refill kit is a consumable, produced by
third party manufacturers as a substitute for the OEM toner
cartridge which is very expensive.
Between all of the practice sessions, qualifying and racing,
the vast majority of your time will be spent massaging the dual shock’s triggers.
The PS3 slim console bundle cheap is obtainable at $299 only
which suggests you’ll be able to simply buy it.
Sony has taken off in the video entertainment world and the Nintendo Wii matches up with the PS3 merely like this: