retirement is a journey not an event 2020 june[a pension is a long-term investment. the fund value...

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Emergency Financial Advice ProjectAccess to FREE financial advice

It’s a question of timingShould I convert my pension pot into cash and/or income?

The financial marketsHow do they affect me?

Better RetirementIn the media

this issue...Monthly round-up............................. 2

Billy Burrows - Bite-Size It’s all about timing........................ 3 Emergency Finacial Advice Project...4

In the news ..................................... 5Puzzle page...................................... 6How can we help?............................ 7

This newsletter is a guide only, it does not constitute financial advice.

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monthly round-up

The general consensus is still to sit tight and not to consolidate any losses by ‘cashing in’ investments now during this period of uncertainty. That’s not to say that there will not be further losses. Some very expert pundits are predicting economic meltdown but the only thing that can be said, with any certainty, is that this situation is totally unprecedented, and no-one knows what will happen.

One of the biggest unknowns is the effect of the billions of pounds being injected not only into the UK economy but the global economy. There are economic practices occurring that, during ‘normal’ times would be almost economic madness. The short to medium term effects are really a ‘best guess’ at the moment.

It is difficult to cover in a monthly newsletter as the situation does change daily and at the time of writing a vaccine is beginning live tests which may have significant impact on us all in a great many ways, including our investments so let’s all wish the trials well.

This guide is for information only and does not in any way constitute financial advice.

The Covid 19 crisis continues to dominate every aspect of our lives and in this crisis, like everyone else, we reflect on the devastating losses occurring every day and praise those who risk their lives to save lives. Not to mention the millions of shop workers, delivery men, bin men, posties etc etc who are also risking their lives to help keep us all going. It is humbling to see, in times of crisis, who the real heroes are.

But how is this likely to affect you personally? Well we have seen incredible volatility in the markets as you would expect.

The chart below shows the FTSE100 since 9th March which demonstrates just how up and down the markets have been.

SOURCE FTSE100, May, 2020

How does it affect me

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YOUR QUESTIONS & ANSWERS

Billy Burrowsbite-size


Monthly question & Answer:

Every month we answer topical questions about pensions and retirement planning. This month, our Retirement Director, Billy Burrows considers the important question of the timing.

Q - I am thinking about retiring soon and converting my pension pot into cash and income. Is this a good idea at the present time bcause the value of my fund has fallen, or would it be better to delay until next year?

A – This is great question because a lot of people will be thinking about this. Although it is a simple question, the answer is complex.

Do you need cash or income now?If you want to access the 25% tax-free cash or need income, it will make sense to consider taking your pension. You can take the 25% tax-free cash without taking an income. When you need an income you can arrange and annuity or take income by way of pension drawdown.

Your ageAlthough you can access your pension pot any time after age 55, you should only access your pension when you are relatively young if really need it. It is difficult to decide when to work out when is the optimum age to start taking your pension but for most people it may be when income from work or business stops and you need to replace this income from savings or personal pensions.

Don’t forget, if you take cash and income too early you may not enough money in later life and if you leave it leave it too late you will not the maximum benefit from your pension but you will leave an inheritance.

Your tax positionsIf you don’t need additional income, it does not generally make sense to take income and pay tax on it because it can remain invested in a tax privileged pension pot. If you can, it is obviously better to avoid paying higher rate tax.

It’s all about timingGenerally speaking there are four areas you should consider...

The state of financial markets

It is obviously better to avoid converting your pension into cash and income when your pension pot has fallen in value, and if you arranging an annuity is obviously better when to do this when rates are not at rock bottom.

However, getting the market timing right is difficult but there are several things you can do to avoid losing out from a stock market crash or low annuity rates.

These include, moving into safer and lower volatile funds before retirement and purchasing annuities in stages.

Although it might be tempting to delay your retirement plans in the hope that financial markets will improve, it is possible that fund values and annuities could fall even further.

Getting advice

As the answer to this question shows, working out when is the best time to convert your pension pot into cash and income is very difficult.

There is a lot at stake so you need to get specialist financial advice.

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Billy Burrowsbite-size

Since the beginning of the year the stock market has fallen by about 25% which means that the value of many pension pots will have fallen by the same amount. People who have a good adviser shouldn’t need to worry unduly if they well diversified investment portfolios which are in line with their risk profile and retirement objectives.

However, many people who haven’t taken advice, may be anxious and don’t know what to do next. It is these people who the Emergency Financial Advice website is reaching out to. There are many questions these people may want to ask including:

• Should I continue contributing to my workplace pension?

• Should my retirement plans be put on hold?

• Is it sensible to purchase an annuity ?

• Should I change the level of drawdown income?

• Should I change my investment strategy?

It is not just about pensions, as everyone of a certain age should review their personal finances and make sure:

• They have a valid and up to date will

• They have set up a Lasting Powers of Attorney

• They have made adequate provision in case expensive care is needed

The fifty financial adviser who are supporting Emergency Financial Advice project have all agreed to offer anybody who makes contact with them, a free and with no strings attached discussion. After this free discussion advisers will use their discretion whether to offer ‘pro bono’ advice for vulnerable and low-income clients or regulated financial advice for a modest fee if needed.


Emergency Financial Advice Project

Better Retirement is one of over 50 financial advisers who are supporting the Emergency Financial Advice project by giving their time free of charge to help anybody who needs financial advice during the current crisis.

The project offers help and advice to anybody over the age of 50 who is anxious or concerned about their pension or other personal finances, e.g. investments, wills, Lasting Powers of Attorney and other retirement planning matters except for debt consolidation.

[A pension is a long-term investment. The fund value may fluctuate and can go down. Your eventual income may depend on the size of the fund at retirement, future interest rates and tax legislation. The Financial Conduct Authority does not regulate estate planning, tax advice, wills or trusts]

The idea was the brainchild of Better Retirement’s Billy Burrows and together with colleagues and the technology company Retirement Systems a new website called www.emergencyfinancialadvice.org has been created where people can ask a question or book a free call with a financial adviser.

“We wanted to find a way to reach out and help everybody who has questions or concerns about their pension or their financial well-being at a time of national emergency and I have been taken back by the support from the adviser community”.

click here

Access to FREE Financial advice

Last month we gave you the ‘detail’ relating to GDPR and if you would like to see this again please let us know and we can resend you our April newsletter. We are intending this to be an ongoing monthly newsletter. If you do not wish to receive further issues, please let us know by return or simply unsubscribe below which is an automated process ensuring you will not receive further newsletter.

In the meantime, Better Retirement continue to give help and advice on all aspects of financial services and retirement in particular.

Just checking your preferences

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Better Retirement can help youWe offer a range of fully regulated services including:

• the preparation of Wills• long-term care funding advice• Lasting Powers of Attorney• creation of trusts• pre-paid funeral plans• long-term care funding advice• buying an annuity• pension drawdown advice• investment advice• arranging equity release• arranging life insurance• arranging critical illnes insurance• critical illness insurance• mortgages• pension consilidation and reviews• long-term care funding advice• compny pension schemes

You will find our fees for legal documents very reasonable particularly in comparison with Solicitor’s charges.

Better Retirement In the media

Emergency advice not for you?It is expected and hoped that many callers will get what they need from the free initial discussion and will not necessarily need to move to regulated advice. If people go on to take advice the normal regulatory rules will apply. If the adviser cannot help, callers will be signposted to the appropriate organisation / agency.

If you are reading this newsletter, the chances are that you will not need Emergency Financial Advice (but you may still need normal financial advice). But if you know anybody who may need Emergency Financial Advice during the current crisis, be sure to direct them to www.emergencyfinancialadvice.org.

Better Retirement started the Emergency Financial Advice project which has featured in the national media including these two articles on well-known websites:

Fifty financial advisers team up to offer free half-hour sessions to over-50s with money troubles in coronavirus crisis - This is Money (website for Daily Mail, Mail on Sunday) 28th April Tanya Jefferies. See thisismoney.co.uk/money/pensions/article-8265381/Financial-advisers-offer-free-half-hour-chats-50s.html

Free advice on pensions and other financial matters - What Investment – 6th May Stephanie SpicerSee whatinvestment.co.uk/free-advice-on-pensions-2617740/

in the news

Coming Soon...Better Retirement to launch new facility on their website - watch this space!

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puzzle page


Tricky DickieEasy peasy

SUDUKU

WORDWHEEL

This word wheel is made from a 9 letter word. Try and find that word, then make as many words of any length as you can from these letters. You can only use each letter once, and each word must include the letter T.

There are 56 words of 5 letters or more!


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If you, or anyone you know, would like any help in any of the areas below then please call us free on 0800 888 6465 or email [email protected]

Annuities Investment advice Life insurance Critical illness insurance Permanent health insurance Retirement Planning Taking out a new pension Company pension transfers Investment advice Life insurance Critical illness insurance Mortgages

ISA’S Wills and trusts Pension consolidation Long-term care plans Equity release Pension reviews (care home fees)

Personal pensions Company Schemes Pension Forecasting

Actual retirement (drawdown options, pension/retirement income, state pensions or releasing tax free cash)

Tricky Dickie

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Better Retirement Founded in 1992, we have assisted over 100,000 people in maximising benefits that they receive from their pension savings in terms of both cash and supporting their lifestyle objectives. For the first 15 years we promoted the Open Market Option annuity through Annuity Direct. We rapidly became the largest specialist in this area, providing weekly information to the national press, BBC Ceefax and other broadcasters.

We have a high quality of process and advice and ensure fairness in pricing and market. This latter point includes challenging and changing the market. We led the work for the automatic provision of the Open Market Option. We started the campaign to ensure Equitable Life behaved fairly - which ended in the House of Lords. Now we are challenging the government to require pension schemes to offer part transfer rather than an all or nothing choice which is often not the best solution.

Better Retirement

400 Pavilion Drive, Northampton NN4 7PAE [email protected] T 01604 521 356

retirement is a journey not an event 2020 june[a pension is a long-term investment. the fund value...

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