<title>News</title> <link>http://www.libertypensions.com/</link> en lisa.wess@ellislab.com Copyright 2012 2012-02-09T09:16:36+00:00 <title>Top news</title> <link>http://www.libertypensions.com/site/top-news/</link> http://www.libertypensions.com/site/top-news/#When:09:16:36Z You may have seen our ‘NO FEES’ campaign on the IFA Online website in January. Well, this is just one of the standout offerings Liberty have brought to the SIPP world since our establishment in 2007. Liberty’s approach has always been to make pensions more accessible and easier to understand. We ensure that every service that we offer brings this approach to life, no more so than our new campaign for No Drawdown Fees. This completely unique fee structure received a great response from a large number of people in the financial services industry. And we foresee a great response from clients too. As it applies a structure that really protects them throughout retirement. At Liberty our ethos has always been to keep pensions as simple and transparent as possible. We are working hard for both our advisors and clients to help soften the burden of the retail distribution review coming into effect next year.&nbsp; As a result of this we will not be charging any fees for both capped and flexible drawdown from 2012 onwards. This means no drawdown setup fee, no annual drawdown fee, no fees for setting up standing orders and no fees for pension calculations and recalculations. This will not only save you money throughout retirement but will also make your life easier when trying to understand what fees and charges will be taken when opening or continuing with a Liberty SIPP. 2012-02-09T09:16:36+00:00 <title>Deadline approaches for the new lifetime allowance</title> <link>http://www.libertypensions.com/site/deadline-approaches-for-the-new-lifetime-allowance/</link> http://www.libertypensions.com/site/deadline-approaches-for-the-new-lifetime-allowance/#When:09:14:28Z People with large pension pots, who would like to benefit from fixed protection, you’re not going to want to miss this! HMRC have set the fixed protection deadline for April this year. So people need to review their pensions to make sure they don’t shoot themselves in the foot. The lifetime allowance will be cut from £1.8m to £1.5m therefore it’s not something to miss out on. The form can be found here, http://www.hmrc.gov.uk/pensionschemes/apss227.pdf, and as it’s the last chance for high net worth’s to protect the value of their retirement funds, swift action is required. 2012-02-09T09:14:28+00:00 <title>Don’t forget about 2008 and 2009 just yet</title> <link>http://www.libertypensions.com/site/dont-forget-about-2008-and-2009-just-yet/</link> http://www.libertypensions.com/site/dont-forget-about-2008-and-2009-just-yet/#When:09:13:35Z Once we enter the new tax year, anybody wanting to make use of the £50,000 carried forward from 2008/09 tax year will lose the chance. This comes as a result of the new carry forward rule introduced by the government last April. Since then we have seen clients maximising their pension contribution to make full use of it. The new rule states that once we get into the tax year 2012/13 the furthest tax year you will be able to carry forward from will be 2009/10. So, if you were looking to make a large contribution in 2012, it might be a worth planning ahead if possible. HMRC have stated that even if you have contributed more than the £50,000 limit in the tax years 09/10 and 10/11 this will not cancel out your ability to bring forward unused allowances from 08/09. Therefore we suggest that you review your figures again before the end of the tax year, just to make sure you have completely maximised your contributions. 2012-02-09T09:13:35+00:00 <title>HMRC throws drawdown clients a safety net</title> <link>http://www.libertypensions.com/site/hmrc-throws-drawdown-clients-a-safety-net/</link> http://www.libertypensions.com/site/hmrc-throws-drawdown-clients-a-safety-net/#When:09:06:31Z People entering retirement are finding themselves extremely worse off compared to this time last year, not only because of falling gilt yields and reduced maximum GAD (from 120% to 100%) but also because of poor investment returns. This move by HMRC isn’t going to help the current situation but it has made sure that it can’t get much worse. With the latest 15-year gilt yield falling to a record low of 2.25% HMRC have stepped in. They have confirmed that even if the yield falls below 2%, administrators can use 2% as the minimum used to calculate the amount of drawdown pension available. &nbsp; 2012-02-09T09:06:31+00:00 <title>What are YOU paying for your pension?</title> <link>http://www.libertypensions.com/site/what-are-you-paying-for-your-pension/</link> http://www.libertypensions.com/site/what-are-you-paying-for-your-pension/#When:11:37:26Z Pensions are going to be one of the longest on-going financial products you will ever invest in, therefore you should be aware of the fees and charges of these products more so than any other. I believe that purchasing a pension product is a bit like buying a car, in that you don’t just look at the initial value you also look at the continuing cost i.e. petrol, tax and insurance. For too long providers haven’t been disclosing their full list of charges and clients are losing out financially on the most important investment they will ever make. All different pension products have different charging structures. Some will take set fees upfront and then on an annual basis, some will charge fees based on a percentage of the fund, some will take cuts of interest rates agreed with the bank and some will take fees every time you wish to invest in something new. The worrying thing is that providers aren’t sticking to just one of these, they are combining a few of them and in some cases all of them. As the client you will normally just see the upfront charges and then forget about it until it’s too late.&nbsp; You need to be asking certain questions when you enter into a pension product. Am I getting 100% of the interest rate, and if not where’s the rest going? What do they charge me to take benefits from the scheme? Do they charge me to make contributions? It’s so important to check how much you’re actually paying, as in most cases it can be quite surprising! 2012-01-04T11:37:26+00:00 <title>Liberty and their simple, transparent and RDR ready fees</title> <link>http://www.libertypensions.com/site/liberty-and-their-simple-transparent-and-rdr-ready-fees/</link> http://www.libertypensions.com/site/liberty-and-their-simple-transparent-and-rdr-ready-fees/#When:08:10:04Z With RDR looming advisers need to be sure that they are spelling out all the fees and charges on a product they are recommending. With Liberty as the product provider this is such a simple process as our fee schedule is so easily understood, meaning no hidden fees, basis points or fees based on percentiles. Hence all of our clients pay our set annual administration fees and receive 100% of the interest rate that we have agreed with the bank. We take a fee for general administration of the SIPP and also for investments that the client wishes to go into. Other than that we don’t really charge for anything else. This means contributions are free to make and also capped and flexible drawdown can be taken without incurring any fees whatsoever. As an industry we are always trying to encourage people to save more for retirement therefore when they come to make additional contributions they shouldn’t be charged for the pleasure. Along with this, the principal reason someone has a SIPP or any pension product is to one day take an income from it. At Liberty we don’t want to charge our clients for this which is why we don’t have any drawdown fees. People are expected to live a lot longer these days and could be in retirement for around 30, 35 years so fees for drawdown can really mount up over this period with reviews every 3 years and an annual drawdown fee plus additional fees for recalculations. Of course not everyone will go into drawdown and if they do they might only take it for a certain amount of time until they purchase an annuity, however these fees can help to cushion the burden of recent pension changes and falling GAD rates. Plus with the second round of quantitative easing looking to push inflation up even further, pensioners are looking to make use of every penny. From market research we found that a member of a Liberty SIPP could be saving up to £10,000 through retirement over a 20 year period. Of course if this individual was in drawdown over the expected 30 year period the savings would be even higher. When clients open up a SIPP they are very interested in what the initial burden is financially, transfer in and transfer out fees, but not many look much further than this. It would be like buying a car without thinking about the tax, insurance and fuel implications. If you got a great deal on a car but it then cost you an arm and leg every time you took it off the drive, would it really be that good of a deal? 2011-11-02T08:10:04+00:00 <title>Beware when transferring your pension</title> <link>http://www.libertypensions.com/site/beware-when-transferring-your-pension/</link> http://www.libertypensions.com/site/beware-when-transferring-your-pension/#When:17:23:56Z In April the government changed the amount of pension that can be taken via drawdown from 120% to 100%, however if you were already in drawdown you didn’t have to change the amount you were currently taking as a pension. You are allowed to continue receiving the same pension up until your next review date which could have been anything up to 5 years and this was pretty good news as GAD rates were also tumbling. However this all changes if you decide to transfer your existing pension into another scheme. When you transfer your pension to the new scheme they will continue to pay your pension just as the old one did. But, and it’s a very big but, your next review date will come around a lot sooner than you may have expected. The new provider will have to review your pension income on the next anniversary date even if there are a few more years to run until your expected review date. The main issue with this is that the new 100% limit will have to be used, and in most cases this will reduce the amount of income available. As I talked about in one of my recent blogs, this could decrease your allowable income by up to 50%. Eg. Clive, a 60 year old man, started to drawdown on his pension pot on the 15th January 2010 crystallising 50% of his pension. Then in November that same year he felt he needed more income and therefore crystallised the remaining 50%. In the summer of 2011 he decided to transfer his pension to another provider and continue in ‘capped’ drawdown (as the name changed in April). Clive believed that his first 50% review would be in January 2015 and the second half would be reviewed November 2015. Due to the changes in pension legislation, the second half of his crystallised funds would be reviewed in November 2011 and his first half would be reviewed in January 2012. The amount he will be able to take from the most recent reviews could be substantially lower and could really affect his current lifestyle. If you are thinking about transferring your pension, especially if you’re currently in drawdown, then you should attempt to seek advice from a regulated Independent Financial Adviser. Matthew Rankine 2011-09-26T17:23:56+00:00 <title>Liberty expand to the capital</title> <link>http://www.libertypensions.com/site/liberty-expand-to-the-capital/</link> http://www.libertypensions.com/site/liberty-expand-to-the-capital/#When:16:48:59Z Due to Liberty’s ever increasing clientele and IFA network, we now have representatives based in London.&nbsp; This has been done to make Liberty more accessible to its advisers, to be on hand for client meetings and to work alongside the adviser to make the SIPP process as simple and efficient as possible. For more information about meeting up with a representative please email . 2011-09-14T16:48:59+00:00 <title>Income drawdown dilemma for pensioners</title> <link>http://www.libertypensions.com/site/income-drawdown-dilemma-for-pensioners/</link> http://www.libertypensions.com/site/income-drawdown-dilemma-for-pensioners/#When:16:47:19Z If you’re currently in income drawdown and coming up to your five year review period, be prepared to be in for a big surprise; and trust me, it isn’t a teddy bears picnic. Around five years ago a client would have had their maximum allowable pension income based on 15 year gilt yields of up to 5.25% and also would have been able to take 120% of this maximum. Furthermore, as long as the client had invested their money fairly sensibly, they would have been getting healthy investment returns compared to ones of late.&nbsp; All of this rolled up together would have given the client a fairly reasonable pension income in comparison to their pot size. Five years on, they’re going to be looking at a completely different picture. Firstly 15 year gilt yields are at an all-time low of around 3.25%. The government has reduced the maximum you can take from the GAD rate by 20% to 100%, and the economy could be heading into a double dip recession. Hence momentarily investment returns aren’t breaking records. Therefore pensioners could see their allowable income slashed by up to 50% when they approach their review date. This could result in a hefty change in lifestyle, at a point in their lives when there is little that can be done about it. There is nothing a client can do to protect themselves against this, however Liberty clients benefit from the fact that we don’t charge fees for drawdown. I recently produced some market research looking at SIPP admin fees for a client in drawdown over a 20 year period against some of our closest competitors. We found that during the 20 year period our clients can make savings of up to £7,000 and this extra money could be used to invest or draw a pension from. 2011-09-14T16:47:19+00:00 <title>Liberty cut their full SIPP initial fee</title> <link>http://www.libertypensions.com/site/liberty-cut-their-full-sipp-initial-fee/</link> http://www.libertypensions.com/site/liberty-cut-their-full-sipp-initial-fee/#When:13:34:20Z In our continued efforts to drive down SIPP fees, we have dropped our initial fee from £425 to £350. At Liberty our ethos has always been to charge only for work we actually have to do and this is another example. We are continually improving our administration methods and systems which results in less work for our administrators, per client. Therefore we are sticking to our philosophy by reducing our initial fee. We already had a very competitive fee structure and have always tried to make it as simple and transparent as possible by not taking any hidden fees and giving 100% of bank interest rates directly back to our clients. This is how simple our fee structure is; Our One SIPP - If you want to invest in one asset you will pay £250 initial and a £250 annual administration fee*. Our Full SIPP - If you want to invest in more than one asset you will pay £350 initial and a £350 annual administration fee*. *These fees also give you free access to any platform that we are a product provider for. Platform providers have separate fees and we don’t take any commission from any platform. For example you could have the ability to invest in thousands of stocks, shares, OIECs, unit trusts etc. and only pay £250 SIPP annual fees no matter how much you choose to invest. So for our average pot size of £100,000 it works out at 0.25%, which is very reasonable, and as your pot increases this will only get better. For more information on our fee structure please visit the fee section on our website or contact us on 01706 826 511. 2011-09-08T13:34:20+00:00