CAMRADATA, a leading provider of data and analysis for institutional investors has published a new white paper entitled, ‘Driving Change and Choice’ based on discussions at its annual Defined Contribution (DC) Pension Round table among an expert panel of investment managers, pension consultants and asset managers. The event was sponsored by BlackRock and First State Investments.
The White Paper analyses how pension scheme provision in the UK is faring following changes introduced to the DC market over the past year. Its other major theme is looking at how to transform the UK from a nation of savers to a nation of investors.
Sean Thompson, Managing Director, CAMRADATA said, “Since our last DC round table event we have been encouraged by generally positive changes that have taken place in the DC market. However, a key issue is that members are not investing enough into their schemes.
“Our mentality needs to change from merely accumulating wealth until we reach pension age to considering when and how it will be deployed across the whole of our lifetime. The White Paper includes interesting proposals from the panel of experts on how this could be achieved.
“Everyone agreed that raising people’s interest in financial services and pensions is paramount and that employees need to be more engaged with their pensions on a personal and emotional level. They need to understand the reality behind the numbers and jargon and visualise what this means in terms of the kind of retirement lifestyle they can expect.”
The roundtable began with a consensus that the rate of savings needs to rise to 15% of salary. The current average across all types of DC in the UK – adding members and employers’ contributions together – is just 4%.
Claire Finn, Head of DC, Unit-Linked and Platforms at BlackRock, noted that 15% was the DWP’s recommended contribution rate. BlackRock supports this target and its recent research found that 70% of respondents would like a mandatory rate of contribution set by government.
Exactly five years after auto-enrolment started, however, there is no timetable to escalate the mandatory rate from 8% after next year. Andrew Harman, DGF portfolio manager at First State Investments, endorsed the notion of contributions rising progressively over time. He said, “Little changes compound over time; start earlier and contribute more.”
Key findings from the White Paper
The panel had three main suggestions on how to transform the UK from a nation of savers to a nation of investors:
- Connect pension scheme members to their investments by reminding them of where they go in the real world, i.e. getting people to realise that they are financiers and their capital funds society’s needs such as new hospitals and roads.
- Focus on an inflation-plus target – or real return. This would give members a more realistic sense of what their assets were delivering as an outcome, in contrast to reporting DC wealth as a lump sum.
- Concentrate on wealth through retirement, reflecting how people now have income from various sources to draw on at different times. The panel proposed that Master Trusts could evolve to offer more holistic financial provision tailored to individual needs. Drawdown also becomes a greater element in whole-of-life investing.
Alan Emberson, PS Aspire’s director of workplace solutions highlighted that young workers should be saving as much as possible, as quickly as possible, and in several different forms, not just their pension scheme.
He said, “The salary pot may not be increasing, but we can help people spend their hard-earned income in a more effective, flexible and efficient manner.”
Meanwhile, Helen Stokes, senior investment consultant at advisory firm, LCP, warned that those other financial considerations, such as buying a house, meant that twenty somethings simply don’t have the capital to put aside substantial amounts of income into pension saving. She warned, “I fear a mandatory contribution level of 15% would put young people off.”
Lydia Fearn, head of DC at another consultancy firm, Redington, agreed with Stokes that 15% could be for some people “unattainable”. Fearn did note, however, that pension contributions were gaining popularity with younger employees where they formed part of an overall package of benefits.
The panel then discussed the impact of Pensions Freedom introduced two years ago in the UK, which has seen many people clear out their DC pot aged 55, in a trend dubbed “Ferrari freedoms” by critics.
The CAMRADATA panel was quick to point out, however, that this kind of behaviour is often conducted by those with other forms of saving, including Defined Benefit pensions. For this golden generation, emptying a minor DC pot aged 55 resembles the use of a DB lump sum at retirement: it affords some luxury – a camper van or a Ferrari – but can hardly be termed irresponsible.
The panel was more worried about the next generation, without DB savings, who might be tempted to take DC wealth earlier and leave themselves destitute as a result.
Niall Alexander, head of DC at consultancy P-Solve said, “At the moment DC constitutes relatively small pots. In 20 years’ time, these pots will be people’s mainstay, so we need to consider DC in the context of outcomes. The days of DC being “play money”, so invest in equities and hope for as much growth as possible, are over.”
The CAMRADATA panel was worried by the ramifications of Pensions Freedom. Alan Emberson warned that the tradition of a hard switch from accumulation to decumulation, realised previously by an annuity transaction at the point of retirement, has in effect been ruptured.
He said, “We need to support a more seamless journey from the point an individual leaves employment and begins to draw funds from their accumulated assets.”
The panel went on to discuss the greater need for education and that technology could be used to improve member education and, consequently their choices. Using technology to communicate with members about relevant decisions at relevant times could help members engage with their pension savings.
The end of the discussion came back to the big challenge of permanently raising workers’ interest in the financial services they use and rely on. Lydia Fearn said that investor education hitherto had failed in its attempts to enthuse savers.
Instead, she proposed something more radical than nudges and apathy. She suggested the links between retirement capital and the world at large had to be demonstrated to illustrate to savers where their money goes.
Lydia Fearn said, “It doesn’t just go to big, bad companies. It builds roads and hospitals; vital parts of our country. The kind of stuff that keeps society going. If pension scheme members knew this, they might feel more of an emotional connection with their pension.”
In conclusion, the panel agreed that this could be one path to convert the UK from a nation of savers to a nation of investors.
Sean Thompson, Managing Director, CAMRADATA said, “UK employees need to become more engaged with pensions or else they could face a very bleak future. Greater financial education is vital and more employers and providers are looking to ways to provide it. This DC discussion was very enlightening and the White Paper a must read for all those involved in pension provision.”
Click here to download the White Paper.
How You Can Make Money From Home
There is no secret to making money online, the only secret is your persistence. Hidden away between the tips on starting a wine club, taking up a photography club or joining the wine revolution, there are smart tips that anyone could use to earn money online without having to quit their day job. We have written lots about the many ways people abroad to help finance their lives.
A good place to start with online jobs is with paid surveys. Surveys pay for your time and allow you to earn a bit of extra cash. The reason you will be able to earn more than what you are actually worth is that a survey company will pay to send you their questionnaire so that you can answer it. The more accurate and detailed your answers the more likely you are to get paid.
There are many survey companies available, you need to choose wisely and carefully as some surveys are paid better than others. For example, you may get paid well if you give an opinion on the health of wine or food. You may get paid just as well if you offer an opinion on which type of music you like.
Another great way to make money online is to write articles. You could write an article and then sell it to an affiliate. If someone likes what they read you will get a commission.
If you are unable to write or if you do not have the time, you could hire someone to write for you. This could be someone who has experience in web content writing or a freelance writer. You could also sell your own articles on an affiliate website such as Clickbank or Commission Junction.
It is easy to make money, it can take some time but it is definitely possible. All you need is determination and discipline to keep at it.
Many people overseas have chosen to live off the grid lifestyle. There are many benefits to living this way and one of them is being able to make money from home.
There are also a lot of opportunities to make money doing research online, there is a constant increase in the amount of knowledge that is available to the public. It is much easier to research and discover new ways of earning money. and you can get started in a short space of time. So, I encourage you to give it a go.
One of the easiest ways to make money online is by becoming a blogger. It really is very easy to become a blogger. Just type ‘blogging’ into Google and then fill in all the details. It is easy and it can even start to look lucrative.
Blogging is a good way to earn money if you have an understanding of the basics. You need to write about something that interests you. This could be about your family life, your interests or even a hobby that you like.
Once you have set up a good website for your blog, the next step is to get visitors to it. One way of doing this is by putting up advertisements. This is just the same as writing articles for other websites.
Some people choose to make money by selling products. You can do this in two ways, through a site such as eBay or through affiliate marketing. You could sell e-books or products related to the niche you are blogging about. The great thing about eBay is that there is always a steady flow of visitors.
These two ways are only two of the many ways to make money online. I recommend you look at all the options and find the ones that work best for you. Once you have found them, you will never stop learning about ways to make money online.
How To Avoid the Risks of Poor Credit
Security Finance is an unsecured debt collecting agency that, via a network of affiliated companies, provides “secure” personal loans to consumers who may otherwise struggle to meet their existing debts. Their loans are generally short-term, and their conditions often vary dramatically from those of traditional short term personal loans. The services they provide can be invaluable to both the consumer and the lender.
Security finance offers a wide variety of loans. These include: home equity loans, revolving credit lines, commercial and business loans, car and motorcycle loans, and other types of unsecured loans. These loans can be used for almost any purpose, and they will be more beneficial to the consumer than those offered by banks and other unsecured lenders.
Secured personal loans offer an excellent alternative to the high rate of interest paid by unsecured loans. The interest rates are often less, the terms are easier to meet, and they are often better suited to meeting a consumer’s unique financial situation. The collateral provided with the loan usually allows security that the loan will be repaid in a reasonable amount of time, with little or no difficulty.
Secured loans require the debtor to place collateral, such as his or her car, home, or other valuable asset, in order to receive the money they have been borrowing, and are therefore considered by the debt collector as an attempt to recover something that has been taken. Debt collectors will not hesitate to call a borrower who does not follow the terms of his or her loan agreement and in some cases will go as far as harassing them, calling and/or sending letters in an attempt to collect on a debt.
When applying for a secured personal loan, many borrowers are worried that the debt will affect their credit score. The fact is that there is virtually no correlation between the amount of credit available and the credit score. However, secured loans will typically have a much lower credit score than unsecured loans. This is because the borrower is putting his or her assets in a bank account where they are likely to be liquidated for payment.
It is important to remember that the loan does not negatively affect the credit history. The only time it can result in damage to a credit report is if it is reported incorrectly. If a borrower were to try to pay off a loan on a credit card that was reported as being “lost”, he or she would then be making the error a second time.
Security finance offers consumers an exceptional opportunity for personal development through the use of online applications, and the ability to make several payments on the same day to avoid late fees and penalties. This service also makes it easy to avoid late fees when paying loans off at the end of the month.
The ability to apply for secured loans online provides a tremendous opportunity for the consumer to improve his or her credit score. Security loans can provide a large number of benefits to people who are in financial difficulty, including: low cost, low rate loans, low credit, and the flexibility of being able to make multiple payments.
If you are considering applying for a secured loan but have never applied online, you should take advantage of the opportunity to make several purchases in a short period of time, rather than waiting until the last minute to apply for an unsecured loan. By using the secured finance website, you can save yourself the time and stress associated with filling out an application and can ensure that your credit report shows your financial progress accurately.
Once you have applied for a secured loan, you should also make sure that you understand the terms and conditions of your loan, including any interest rate that may apply to the loan. Be sure that you understand the term of the loan in full and fully. Do not hesitate to ask any questions that may arise. You should always contact the company directly when you feel that you are not fully clear on a matter regarding a loan.
Secured finance loans are a great way to increase your credit score while avoiding the hassle and expense of filling out and paying off an application by mail. Because the borrower is making a direct deposit of money into an account, the credit report that shows up on credit reports is often inaccurate.
How To Find Free Rates On Money Exchange
Money is a common item that can be bought, traded, exchanged or sold. This usually includes the value of the currency as well as gold and silver. Money is commonly accepted as payment of certain obligations, including taxes, and payment of certain goods and services in a specific country or socioeconomic context.
There are three money systems in the world. The first is the use of coins or other units of currency, which are available in fixed denominations. The second is barter. It involves exchanging items of utility with other items of utility. In the third system, known as fiat money, there is no central authority that decides what the money supply is, and the monetary base is determined by political will.
The most common monetary system is the gold standard, which was used as far back as ancient Greece and Rome. In this system, coins were designed to be redeemable for gold bars. Gold, however, had a relatively high price at the time, and most individuals had no access to it. Barter is much more popular today, and most people live their lives in barter, trading items with one another.
In some nations, the second money system is called paper money. Most countries have national currencies, and each government issues money in the name of their country. This type of money is not backed by anything of physical value. It is not held by the government or bank. It is simply made from paper. Since most countries use this kind of money, it is known as the official “money” of the country.
Electronic cash was introduced in 1970. This system is very similar to barter. Instead of bartering for items, electronic money is created electronically. It is created electronically to represent actual objects that can be used as payment, and then is transferred to the buyer. The process is very similar to barter, except that there are no actual goods to be bartered for. It is considered a virtual currency.
There are many different types of money, and each one has its own characteristics. Money in the U.S. has a backing and is created by the federal reserve. Money in England is backed by the pound sterling, while the European Central Bank in Germany uses the euro. has a currency known as the Deutschmark.
Each form of money has its own advantages and disadvantages. People who use different forms of money have their own reasons for doing so. Many people choose to exchange one form of money for the other, to get the best rate on an item they need or want. Some choose the same form of money for more than one transaction.
Money exchange services offer different services to help people get the best rates on money exchange. They include a variety of methods that can help someone get a better rate. Rates vary depending on the length of time you wish to get money, the size of your order, and the current value of the item you are exchanging. Some of these services can also provide you with a credit card or other form of online payment to transfer your money through.
These services are available almost everywhere. You may call around to various companies for rates, or you can check out the Internet. There are several places on the Web that will give you free quotes, and compare rates among companies. It is important that you understand the rules and regulations that govern the rates you receive from these companies before you agree to any deal.
There are several different online providers. You will often find them listed under the names of a variety of different names, such as Money Exchange, Moneygram and eCash. If you are interested in getting quotes from multiple companies, make sure to ask around for quotes from at least three. so that you have a clear picture of how much the rates will vary and from which company to go with.
Many places will offer you a variety of free quotes if you fill out a form. Others will charge a fee for this service. To get an estimate, you should send out several free quotes. and then make sure to follow up with the companies.
To be able to get the best rates, it is very important that you get as many quotes as possible from different companies on the Internet. There are many sites that you can go to. Some will charge a fee to get these quotes.
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