I’m interested! What’s the impact of the Government’s pension changes on IFAs?

Posted on March 27, 2026 by henry tapper

What is happening in the world of workplace pensions?

While the IFA may be interested in wealth management, the Government has moved to get workplace pots that turn into pensions.

There are two changes that they have introduced. The first is the promotion of retirement income from existing workplace pensions. This is through  the Pension Schemes Bil and the second is legislation that enacts CDC as a multiple employer workplace Pension.

There is also legislation on the books now that will mean that pots that haven’t turned been turned to an annuity or a CDC or DB pension will become part of an estate on the potholder’s death. This will be from April 2027.

You might well ask what is a CDC pension? The answer is that there is no personal pot in a CDC anymore than there is an annuity. There is not even space for an AVC style DC pot.

By comparison, DC plans will continue to hold a DC pot for savers. These pots can be transferred into pots relatively easily compared with a transfer the CETV pensions of a deferred pension.

We are much more likely to see DC pots transferring to CDC schemes, to annuities and to public sector pension (which can accept DC transfers in a member’s first year of service).

With gilt rates at their current level, the transfer from deferred DB and CDC pensions to wealth management “pots” is unlikely to be very high.

We have seen the levels of CETV transfers fall off a cliff, partly for regulatory but mainly for commercial reasons, pensions are better value in the pension holder’s eyes than they were when they could be exchanged at up to 40 times the deferred pension income pay-out.

Here there is a major conflict for master trusts and non-commercial trusts set up on an own occupation basis. These organisations, to operate in future will need to provide a default retirement income with protection later in a saver’s life so that the income does not run out. This has led to the concept of default “flex and fix” with Nest being the first to disclose its version. With Nest the member will remember in drawdown until 85 and then move to annuity via a bulk scheme with specialist insurer Rothesay.

Another £30bn + master trust, WTW’s LifeSight has opted for what will be a Retirement CDC scheme; let’s call it a stage 3 CDC scheme (Stage 1 being the individual company scheme – as used by Royal Mail, Stage 2 being whole of life CDC for multiple employers and Stage 3 being a CDC pension for those at retirement and in a DC workplace scheme). This third type of CDC scheme will go a different route from “flex and fix” converting pots to CDC pension by default at retirement.

The legislation for Retirement CDC has yet to be drawn up but it looks as if flex and fix and retirement CDC will be the main choices for master trust schemes. It is likely that for retirement, workplace GPPs will be rolled into master trusts (not least to ensure that insurer’s workplace pensions are at least £25bn in size by 2030 – which they’ll ned to be).

There are some large GPPs out there, BT has a BPP with Standard Life, the FT has one with Scottish Widows and the Daily Mail use Fidelity.

So, a combination of the Pension Schemes Bill (and soon to be Act) and the enacted and “being drafted” CDC literature will change workplace pensions – primarily in retirement but in the case of whole of life CDC, at any age.

 

What will this mean for IFAs?

I suspect that all this will legislative change will lead to reviews of pension planning for individuals taking advice. For many who do, wealth rather than income is most important and for them whole of life or tapering insurance appears the obvious way of protecting the estate from an IHT liability from a pension pot. Some wealthy people will buy annuities and a few exchange pots DB and CDC pensions but it looks likely that most will prefer the freedom of a SIPP or similar.

Meanwhile, the older generations who are retiring now, may give way to a younger generation without the wealth who over time will look at their workplace pensions as lifetime income rather than pots. This will be backed up by a Pensions Dashboard which will display pots as pensions.

IFAs are going to have to speak to the current retirees and those close to retirement about the changes but their children will need to be reminded of pension freedom in a world where pensions mean retirement income with some cash when deferred income comes into payment.

There will be a generation of IFAs that will remember an old adage “pensions are an insurance against living too long”!

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Getting money back from the tax man

Posted on March 27, 2026 by henry tapper

I got in late the other night and checked my mail. There was an ominous brown envelope, the kind you get when they’re after you. I walked upstairs to my flat trembling and summoned up the courage to open it.

Instead of a demand or a summons to attend a meeting to explain myself there was a cheque, attached to an explanation that through PAYE and not through self assessment ( which I no longer do) I had paid too much.

It just sat there on my dining table and I thought “that’s a cheque, I haven’t one of them for ages” – because I haven’t.

The next day was busy and I worried in the back of my head how I use to pay cheques into my bank with First Direct. It was before I had a couple of brain haemorrhages in November 2024. Finally I remembered I used to pay into a post office or an HSBC bank. I checked (no pun) to find out where one was. I live in the City, it must be easy. I live in Blackfriars, holy smoke the nearest one was nearly a mile away near the top of Chantry Lane.

I decided to set aside the lunchbreak. I set out at 1pm across the busy Ludgate Circus , past the world’s big lawyers (Dentons where my mate works) and to the HSBC at the top of Fetter Lane.  I went in (scared) and there was a man who pointed me to the back of the bank , past the army of machines staring angrily at me for not using them.

There at the back was a queue of old people with cheques in their hands. We waited our turn, we filled out paying in slips. I was frozen from the walk and found it hard to find the numbers on the back of my banker’s card. I remembered something called a cheque book.

When I gave my cheque and the paper slip to the lady behind the glass protecting her she smiled kindly, that look young people give those with grey hair. She couldn’t read my writing as she keyed my details into her slip, I had to give her my card, she re did my zeros with a cross across the circles saying zero.

Finally she said she’d found me, I was real because my account matched what I had declared about myself. The cheque from HMRC is now making its way into money paid into my account so I can have a free trip to Scotland to be with my brothers in Kinloch Rannoch – on the tax man.

Well that’s not quite right. I’d overpaid my tax and found the cheque and opened the envelope and found and gone to the bank and will today be the richer.

I’ll find out all that on my First Direct app which I was told I could have used to pay the cheque in. The lady in the bank told me that the next time I should have used the picture of the cheque I took and sent the photo using the app and paid the money in that way.

Then I thought of an even better way! HMRC had taken the money out of my pay and worked out that they’d done it automatically. Couldn’t they have knocked the amount they charged me through my tax code? They know my bank details, I normally pay them extra every year, I haven’t changed my bank account this century. Could they not have paid it digitally into my bank account?

I thought I’d ask my reader – why does HMRC send cheques by post? Do they really trust the Royal Mail? Do they trust these valuable cheques from getting knicked or thrown away?  How many of these cheques get thrown away , the envelopes thrown away with all the nonsense that comes out of compliance with some banking regulation?

I think there should be a better way to pay me my tax back than sending me a cheque and though I’m grateful for the money wonder if I’ve got more HMRC cheques that never made it – the lucky way this one did – to the bank!

Press on past the pop ups that the Bank website will offer you.

Press on, press on , if you press hard enough – you will find this picture!

There are people who still work in banks like First Direct’s owner – HSBC!

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Good, bad or irrelevant? The impact of these pension changes on IFAs.

Posted on March 26, 2026 by henry tapper

What is happening in the world of workplace pensions?

While the IFA may be interested in wealth management, the Government has moved to get workplace pots that turn into pensions.

There are two changes that they have introduced. The first is the promotion of retirement income from existing workplace pensions. This is through  the Pension Schemes Bil and the second is legislation that enacts CDC as a multiple employer workplace Pension.

There is also legislation on the books now that will mean that pots that haven’t turned been turned to an annuity or a CDC or DB pension will become part of an estate on the potholder’s death. This will be from April 2027.

You might well ask what is a CDC pension? The answer is that there is no personal pot in a CDC anymore than there is an annuity. There is not even space for an AVC style DC pot.

By comparison, DC plans will continue to hold a DC pot for savers. These pots can be transferred into pots relatively easily compared with a transfer the CETV pensions of a deferred pension.

We are much more likely to see DC pots transferring to CDC schemes, to annuities and to public sector pension (which can accept DC transfers in a member’s first year of service).

With gilt rates at their current level, the transfer from deferred DB and CDC pensions to wealth management “pots” is unlikely to be very high.

We have seen the levels of CETV transfers fall off a cliff, partly for regulatory but mainly for commercial reasons, pensions are better value in the pension holder’s eyes than they were when they could be exchanged at up to 40 times the deferred pension income pay-out.

Here there is a major conflict for master trusts and non-commercial trusts set up on an own occupation basis. These organisations, to operate in future will need to provide a default retirement income with protection later in a saver’s life so that the income does not run out. This has led to the concept of default “flex and fix” with Nest being the first to disclose its version. With Nest the member will remember in drawdown until 85 and then move to annuity via a bulk scheme with specialist insurer Rothesay.

Another £30bn + master trust, WTW’s LifeSight has opted for what will be a Retirement CDC scheme; let’s call it a stage 3 CDC scheme (Stage 1 being the individual company scheme – as used by Royal Mail, Stage 2 being whole of life CDC for multiple employers and Stage 3 being a CDC pension for those at retirement and in a DC workplace scheme). This third type of CDC scheme will go a different route from “flex and fix” converting pots to CDC pension by default at retirement.

The legislation for Retirement CDC has yet to be drawn up but it looks as if flex and fix and retirement CDC will be the main choices for master trust schemes. It is likely that for retirement, workplace GPPs will be rolled into master trusts (not least to ensure that insurer’s workplace pensions are at least £25bn in size by 2030 – which they’ll ned to be).

There are some large GPPs out there, BT has a BPP with Standard Life, the FT has one with Scottish Widows and the Daily Mail use Fidelity.

So, a combination of the Pension Schemes Bill (and soon to be Act) and the enacted and “being drafted” CDC literature will change workplace pensions – primarily in retirement but in the case of whole of life CDC, at any age.

 

What will this mean for IFAs?

I suspect that all this will legislative change will lead to reviews of pension planning for individuals taking advice. For many who do, wealth rather than income is most important and for them whole of life or tapering insurance appears the obvious way of protecting the estate from an IHT liability from a pension pot. Some wealthy people will buy annuities and a few exchange pots DB and CDC pensions but it looks likely that most will prefer the freedom of a SIPP or similar.

Meanwhile, the older generations who are retiring now, may give way to a younger generation without the wealth who over time will look at their workplace pensions as lifetime income rather than pots. This will be backed up by a Pensions Dashboard which will display pots as pensions.

IFAs are going to have to speak to the current retirees and those close to retirement about the changes but their children will need to be reminded of pension freedom in a world where pensions mean retirement income with some cash when deferred income comes into payment.

There will be a generation of IFAs that will remember an old adage “pensions are an insurance against living too long”!

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Your £50k pension surplus negotiable with your DB trustees and the boss!

Posted on March 26, 2026 by henry tapper

Yesterday I sat through a day in the City listening to insurers talking about the safety of giving them your money while everyone else wanted to talk about what to do with the surplus funds not needed to pay the promised pensions.

Meanwhile, over the other side of the City of London, Jonathan Guthrie was getting ready this epic read which reminds us, what this blog has said for several years, that pensions schemes owe their members the best possible pensions!

Here are some excerpts, if you are an early bird you can get this read for free, if not – you can contact henry@pensionsmutual.co.uk and I’ll send you his golden words! Here’s the free link .

We may be in what the pensions industry calls the “end game” but defined benefit schemes are still very real for most of the people in this country lucky enough to have been in one (or more) as a result of the work they carried out.

The schemes already provide a fixed pension for life to white collar toilers past and present, not just foundry and factory workers.

The income is guaranteed by a current or former employer. The promise is backed by investment funds. These have accumulated surpluses in excess of their liabilities totalling some £160bn according to one government estimate.

Reforms expected to become law in April would let funds release some of this cash. The second chart shows the value per member of surpluses at different levels of scheme funding. The numbers are eye-popping by the modest standards of average pensioner incomes.

For example, schemes with assets amounting to more than 140 per cent of liabilities are sitting on excess funds averaging £50,000 per member. The figure is £10,534 per member for the largest group, which is served by schemes with surpluses of 105-110 per cent.


A big caveat applies. The money does not technically belong to members. Nor can sponsoring employers automatically grab it all. Pension schemes are run by trustees on behalf of members. Trustees may be members themselves, company executives or independent professionals.

Sponsoring employers are likely to see surpluses as “overpaid contributions,” says Lynda Whitney, a senior partner at consultancy Aon. To members, the money may look more like

“deferred benefits” but m in practice, the use of surpluses will involve a negotiation between trustees and the company.

” My hunch is that the starting point for many of these haggles will be a 50/50 split”.

You can see how well the Stagecoach trustees did for their bus-driving members when you discover the members are getting 2/3 of the Stagecoach pension fund’s surplus.

Guthrie is quite brilliant at reminding us of how members have benefited from surpluses in good time.

In the past, pension funds sometimes reduced surpluses by increasing members’ monthly payouts. Younger members will like the sound of that. Older ones will object that their lower expected longevity reduces the value of such increments.

This reminds me of arguments over the SPA and pension increases. There are various vested interests at work – something that Steve Webb always picks up on.

This is one reason why surplus distributions will most likely be via lump sums, according to Sir Steve Webb, partner at Lane Clark & Peacock, another consultancy.

Moreover, “companies will prefer a method that does not create more long-term liabilities”. Much of the well-intentioned paternalism that inspired defined benefit pensions lingers in the way they are run.

But as BP’s pensions (and other well organised pensioner memberships) know only too well.

Ordinary members are not expected to play a role in surplus negotiations.

There is a long section at the end of Jonathan’s article that looks at the legal ins and outs of sharing surpluses. We had a lot of that yesterday at Professional Pension’s excellent end game conference.  I won’t rehearse but cut to the chase. This is all very well for the “haves” but what of the “have nots”?

Members of low-cost defined contribution pension schemes — which now dominate private sector workplaces — should meanwhile wonder why they are being left out. They could legitimately ask for employers to funnel a portion of surplus repayments into their pension pots. No rule forbids such top-ups, according to Tiffany Tsang, head of defined benefits at Pensions UK, an industry body.

If you don’t ask, you won’t get.

If Jonathan included “collective defined contribution” in his comment on workplace pensions, I’d totally agree. We are in an era of negotiation, unions are waking up and so are many members who have pots big enough for it to matter. I mean by that every body!

 

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Wealdstone a cracking club; Yeovil a cracking win!

Posted on March 26, 2026 by henry tapper

It’s been hard work the past few weeks, what with launching the Pensions Mutual and dealing with all that comes with arranging a CDC scheme for employers and their staff.

So when I haven’t been working, I’ve been willing on my football club, Yeovil Town, to avoid relegation. Last night I was a guest of my friend Derick Tomlin and sat with my son and the Wealdstone fans as Yeovil eased 2-0 away and towards safety.

It was a late night for an early bird but I wanted to catch some of the fighting spirit we witnessed last night. Thanks to Wealdstone, a wonderful club of which Derick is a founding supporter in its fan’s club. Since 1956, he’s never seen his club so high up the pyramid, well done to them and well done to their supporters for taking an unexpected reverse with good humour. We know what having a good night is!

A week can make a lot of difference, what with a win at home against Morecambe on Saturday, life is a lot better. On the Metropolitan back through Betjamin’s suburbia I chatted with Capital Glovers while the body of our fans were on busses back to the West Country.

We’d been at the centre line – sitting in the coldest stand watching our Perrett get send off by 50 minutes at Grosvenor Vale (see video below)

This simulation of 10,000 situations, has Yeovil having every chance of finishing in the upper half of the table. Ever optimists!

Title race flips – Rochdale now favourites (66.5%), York drop to 33.5% 📈 Yeovil climbing – Top Half chances jump from 13.1% to 28.5% 📉 Gateshead moving clear – relegation risk down to 38.4% Same model. A few results. Big swings. #YTFC

And now the good bit for Yeovil fans and not quite good bits for everyone else, but you’ll allow me the little happiness of remembering a great night!

It was not Arsenal, or even Tottenham, but this is the stuff! Here’s young Mitchell Clarke

Top performance that 👏 Started a bit off it, grew into it after 15mins and then only one team in that game. Even after going down to 10 they put a hell of a shift in. Credit the lot of them 💪 Roll on Saturday now, 9 points in a week.. can’t be done.. can it? 🤔 🇳🇬 #ytfc

 

 

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UK Pension Schemes : Investing Overseas (didn’t in practice work!)

Posted on March 26, 2026 by henry tapper

Jon Spain is a legend of our Government’s actuaries and one I have missed on this blog for some months. While Jon objects to HMG’s power grab on principle, he thought it would be interesting to look at how returns from US equities would have compared with UK equity returns. The results are briefly summarised in the attached piece. I am delighted to give him space to explain

At present, HMG are trying to gain the power to force UK pension scheme trustees to invest in UK companies rather than elsewhere. While I think such a power is inappropriate, I thought I’d look at what would have happened, comparing £1,000 either invested in UK equities (FTSE All Share Index) or invested in US equities (S&P 500 Index) and repatriated to UK. The timeframe considered is 15 years from end 1971 until end 2025. No allowance has been made for investment expenses or currency exchange fees (taken from St Louis Fed). Nor have I even tried to allow for the impacts of exchange control and the “dollar premium” before 1979, which  would have lowered the returns from investing overseas even further (thanks, Con Keating).

Simple Example  At the end of 1971, £1,000 is invested in UK equities for 15 years and the final fund is £9,769. The £1,000 is exchanged for $2,571 which accumulates to $11,787 which is then exchanged into £7,830 at the end of 1986. That the annualised US return of unfavourable. On the other hand, the reverse exchange rate from dollars to sterling almost doubled from 0.3890 to 0.6643, partially reducing the relative investment loss.

 

Exchange Rates  These are charted as the picture above. Over 54 years, the end-year exchange rate varied between 1.1271 (end 1984) and 2.5705 (end 1971).

 

 

Local Equity Returns Over 15 Years  These are charted as above. The UK {US} annualised equity returns fell between 3.86% {4.19%} and 27.53% {18.80%}, averaging out at 11.49% {11.31%}.

Final Fund Comparisons  These are charted as the third picrure. In sterling, the UK {US} final fund amounts fell between £1,765 {£1,961} and £38,403 {£14,105}, averaging out at £7,053 {£6,449}. The grey figures show the statistics for the ratio of US to UK, which I would like to have added as a line related to the right-hand axis but I couldn’t work out how.

In 18 out of 40 cases, the US investment would have been less favourable than for the UK.

Jon Spain

 

Jon Spain                                            24 Mar 2026

 

 

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David Walmsley – TPR “shaping the endgame”

Posted on March 25, 2026 by henry tapper

David Walmsley kicked off an Endgame Conference organised by Professional Pensions

More than half (54%) of schemes are in surplus on a full buy-out basis, three quarters are fully solvent. This is for TPR a new world.

A new way to self sufficiency must have an investment strategy  that isn’t bumped our of solvency.

Schemes must still show how they will stand up to stress. I suspect that what is happening in the markets today will be a test case.

Innovation is fine but it must be safe to the scheme. That means to pay the promised pension,

Buy out may no longer be the gold standard. Trustees may wish to run on, trustees can explore surplus pensions being shared with sponsors and members, There is a wish from the TPR for the surplus to be shared responsibly.

The Pensions Regulator is prepared to accept alternatives. We did not talk of Stagecoach/Aberdeen but it was clearly in the back of David Walmsley’s mind. He was pressed to explain what he meant by innovation and he said he couldn’t. He said he was expecting three superfunds putting themselves forward for authorisation in the next three months. They have all used their innovation service,

As far as testing Schemes’s capacity to cope with market volatility there was interest in how TPR considered what the volatility we’re seeing now were impacting its view. TPR is likely to make a statement after the end of the month.

He wanted schemes to get on with surplus sharing preparations rather than wait for a code from TPR .

There was a question on AI and in particular AI agentic pension advice. This had been a question at a recent administration meeting in the same room earlier month.

David was asked whether advisers should be regulated. He said they were regulated but not necessarily by TPR.

Small schemes are looking at sharing surplus, but there aren’t many small schemes around yet.

The biggest data for the TPR was the biggest risk for schemes and employers considering their endgame – DATA. This had been the main threat to success for those in the room.

The questions ended with a question as to whether more trustees should be appointed not just to small schemes but to bigger schemes. Walmsley said TPR were preparing an answer.

A steady as you go talk from David Walmsley (in my opinion)

 

 

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Pensions Schemes should be managed for pensioners, not as a business problem

Posted on March 25, 2026 by henry tapper

This sounds likely a way of parking a lorry in a car park.

It’s the wrong vehicle in the wrong place at the wrong time. Pension schemes may not be convenient for American parents but they are very important to the pensioners and those who will be pensioners in years to come.

So long as we get American sponsors thinking that fiduciary management teams (dressed as trustees ) can park the UK pension lorry in a car park, we will continue to advertise our pension schemes as a nuisance.

Instead, we should be returning the pensions to the people who drive the cars – the ordinary people.

We need the people making decisions about the parking of the big trucks that are our occupational pensions, getting the pensions to deliver the goods.

Pensions need to be managed for the people who are beneficiaries, not as a management problem to be minimised by business people.

 

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Apollo is on the ropes; its “PIC” pays a lot of our pensions, should we be worried?

Posted on March 25, 2026 by henry tapper

I am off for a day discussing the “end game” at the City.  I am given a promise about  “Shaping the Path to Stronger Outcomes”, where we’ll explore the decisions shaping how schemes are executing the endgame.

I’ll take part in focused discussions and hear from leading schemes on how they are navigating insurer engagement, transaction readiness and surplus strategy. I’ll leave equipped to make purposeful, informed decisions that secure members’ futures and support meaningful progress across the UK pensions landscape.

Well one of the things that I’ll want sorting out is how confident I can be that what is happening the money shipped across the pond to be “invested” in private credit in the USA, is safe. Take Apollo which now owns the Pension Insurance Corporation (PIC).

The capacity of large fund managers in the USA to pay claims from people trying to get out of semi-liquid funds is worrying.

The FT tells us

Apollo Global Management has limited redemptions from one of its flagship private credit vehicles, becoming the latest investment manager seeking to staunch outflows as wealthy investors retreat from the industry.

The fund also posted its first monthly loss in February in more than three years, reporting a -0.07 per cent return.

The loss in part reflected a sell-off in more liquid loans, which Apollo uses to mark the value of private loans it holds that do not trade.

I remember 20 years ago not being concerned that banks like Bear Stearns were getting into trouble with credit. For a little while we were mildly amused until its re-occurrence at Lehman Brothers.

I do not understand America in any sense and I don’t want its financial winners losing my pension.

We have a death wish on our pensions. We want them off our hands in gold-plated annuities run by insurers that can’t fail. But there is an alternative. Rather than the euthanasia of buy in and then buy-out , we could look after our pensions for the extent that members are alive – which could be a very long time.

We could use superfunds, as Ashok Gupta and others are arguing.

New Capital Consensus is a coalition of non-for-profit, apolitical organisations that have come together to explore how the current UK investment system contributes to the country’s current problems of low productivity, inequality and low levels of investment. Its objective is to find ways to release investment capital to address societal problems, like those above and in particular, to green the economy.

I would like to hear from Ashok and others involved in this coalition, arguing as William McGrath and C-Suite argue and many who run pension funds which have chosen to keep going.

Lets have a  good argument today about what we can do with give with our £1.2 trillion legacy of DB pensions. We may be  doing better things with our pensions and their surpluses than line the trousers of American bankers.

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Why is WTW’s retirement CDC not getting the thumbs up?

Posted on March 25, 2026 by henry tapper

We always need analysis to help us make choices.  We are getting a lot from WTW about decumulation CDC and the numbers don’t look anything like 60% better for CDC if you wait to swap your pot for a CDC pension at retirement. Why not?

Well – take a look!

What is great about WTW’s work is that they have made the comparisons on a peach v peach basis. This is most important when it comes to increases on the pensions

All the comparisons are made with an inflation linked income or pension or annuity. This is fun but Retirement Line tell me that you can’t buy a CPI linked annuity so this is a bit “made up”. It does make you a little nervous.

The modelling includes some interesting features like a 10 year pay out from the single pot by the CDC (less whatever has already been paid). This would mean your R-CDC would pay  a partner a pension and the full amount paid to you would continue to be paid until 10 years from commencement after which the pension would  reduce  to 40% of what you got

Well done WTW.

Again thanks to Retirement Line for clarification. The truth is we don’t know what Retirement CDC will look like yet so we’re looking at guess work from WTW – no matter how smart the Maths!

There’s still good news but not as much!

The good news is that where an annuity would pay you £5,750 pa, CDC from a swap of a pot would give nearly £7,300 , 25% more than the annuity and 15% more than flex and fix.

The figures are lower than whole of life CDC because you’ve hung onto your pot till you retire. The “up to 60%” is what you get over the whole of your life buying pension and not saving in a pot.

The choice between flex and fix and CDC is still meaningfully in favour of CDC for pensions . But WTW are fair in pointing out that some people will prefer flex and fix to R-CDC as this picture explains.

It is very helpful that WTW do this hard work when it will be at least two years and probably three before you can buy a Retirement CDC.

We have yet to have the results of the consultation , the high level consultation or the Pension Regulator’s Retirement CDC Code- there will be authorisation after all that.

And at the end of it all, the prospects of getting access to growth assets for most of your life depend on you not living overlong

The scheme starts de-risking when you are at 7o and is mainly in bonds from 85, better than flex and fix and annuities – if in a collective fund- but it means a mature scheme will look much more like 60/40 in favour of growth and a scheme with just older folk in it may start looking more like an annuity. There is no spreading of risk over a wider group of people who may be as young as teens!

Herein the problem with waiting till retirement to collectively invest. What your DC pot has been invested in,  in the years leading up to retirement may not be matching the growth assets of drawdown or R-CDC illustrated above.

In reality, we think that retirement is the Straits of Hormuz of pensions, the point at which the  nastiest financial problem in pensions is presented as “choice”. Better and simpler to be in CDC for the whole of life or at least what remains of it!

 

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