I stuffed a thick brochure into my rucksack. It claimed to be the Case for CDC at the PensionsAge show yesterday. I’d just seen Sophie Dapin and Christian Hyldahl explaining Europe’s commitment to collection.
This week the Pension Commission has been in Netherlands, next week they’ll be in Denmark. Christian Hyldahl is Danish and couldn’t have been more topical for us in the UK.
where
I read it in the hour it took me to get back home and I realised it was the first time that a study from an investment point of view of why CDC pays more – has been published.
Thanks BlackRock
The report is subtitled “understanding the investment implications of Collective Defined Contribution Schemes”. I warmly recommend it – as I’ve said before on this blog, BlackRock are putting a lot of effort into promoting their understanding.
This morning this promotion of the Case for CDC from BlackRock appeared on my timeline, I have no hesitancy in bringing it to all our attention.
If pensions are to provide income then tax free cash is
hard to justify Remove this and income goes up by 33%
especially relevant for those with small pots and
inadequate contributions for whatever reason.
The treasury also gets more
As far as we know, there is no plan for further restrictions to taking tax-free cash. There is of course a freezing of the amount (in real terms) by doing nothing to it.
Surely taking a commencement lump sum is turning income to pots and CDC is all about going in the opposite direction.
The majority of funds available at retirement are insufficient to provide an adequate income yet this substantial amount is ignored surely 33% helps and beats 6%
33% plus 6% is even better for the member
An argument for applying the CLS to a PLA could be made
You say there are no plans to do this but CLS is capped under old LTA rules unless protection exists
The DB world has always promised an income and offered tax free cash. I chose not to take the tax-free cash when I was offered it as part of my becoming a pensioner and that decision is available to everyone in DB, CDC or DC