Chapter 1 Flashcards
What are the SPA’s & when are they reviewed
2010 - 65 Men/60 Women
2018 - 65
2020 - 60
By 2028 - 67
Must be reviewed in every parliament
When was Pensionwise established
2015
What happened to the State Guarantee credit when State Pension was introduced?
Nothing the State Guarantee credit continues to provide support for poorest pensioners
What are the demographic trends that apply
Working population reducing
Retirees growing
Huge impact on cost of DB
What are the annuity rates from 1980 onwards
1980 - 15%
2000 - 9%
Early 2022 - 5.4%
15, 10, 5
What are the corp environmental factors that apply
Less DB as increased longevity
Greatest Impact is auto enrol
Flexibility means less restrictions so more appeal
DC - employee has inv & annuity risk
Change of employers - stops & start conts as change jobs/many paid up pots.
Who has a NI increase if contracting out stops
Both Employer & employee
Incentives for pension savings
No limit on conts, limit on tax relief
Inv emempt from CGT/income tax
DC beneficiary options - best if before 75
How are employer conts classed for tax purposes
as a business expense for corporation & income tax - relievable against corp tax.
How much can a member take from a DC arrangement for pensions advice?
£500 per TAX year
If employer pays for advice then not a BIK as long as similar advice to all employees
What is the main reason that people don’t save
Affordability
Who does S2P benefit
Carers, Long Term disability and broken work records
How are DB benefits calculated
Pensionable service, period of membership, accural rate
Not Investment return
What is a Hybrid Scheme
Specific amount of benefit at min. pension age an example is targeted money purchase scheme
