The average
worker now has many more jobs throughout their lifetime than they used to. With
the introduction of auto-enrolment this means many people are likely to end up
with several pensions by the time they retire, and to have to grapple with
multiple schemes.
In fact recent
research shows many people aren’t able to keep track of their many pension
pots, resulting in an estimated £19.4 billion going
unclaimed in the UK estimates the Pensions Policy Institute.
With the
increased paperwork and costs of having many different pension pots, it may
make more sense to combine these into a single pension pot.
Some of the
advantages of consolidating include:
- Broadening
your investment choice: particularly with a Self-Invested Personal Pension
(SIPP) or a (Small Self-Administered Scheme) SSAS, which we discuss later
- Older
schemes may not allow you to withdraw capital early as you can with the new
pension freedoms introduced in 2015
- A
larger fund may reduce costs with some providers or platforms
- You
should be able to transfer your pensions in a short space of time if your
pension provider has signed up to a paperless transfer service.
Consolidating
all your plans in one place will certainly make it easier to monitor and
possibly reduce costs but what are the alternatives and how do you go about choosing
one?
You could
transfer your existing pension pots to another pension scheme, which could be a
new employer’s workplace pension scheme, a personal pension scheme, a
self-invested personal pension (SIPP) or a Small Self-Administered Scheme
(SSAS).
What is a SSAS?
A SSAS (Small
Self-Administered Scheme) is a pension vehicle established under Trust by a
private limited company and registered with HMRC.
A SSAS is a type of defined contribution pension that an employer can
self-manage for less than 12 members and is set up by the directors of a
business to gain more control over how their pensions are invested.
It differs from
a SIPP in that it is set up by
a company director as the employer rather than an individual and is designed
for owner-managed businesses, SMEs, and family businesses.
Whilst a SIPP can be used by anyone,
as it is not connected to a Ltd company, it is an ideal vehicle for family
businesses and SMEs as it can be used to fund business growth. A SIPP also
gives you greater control over investment decisions. It also offers a wider range of permitted investment classes, such as gold, high
interest savings, commercial property, listed and unlisted securities. It
allows investment in assets that might be considered too high risk by a SIPP.
Request our SSAS vs
SIPP comparison table to find out more about which might best suit
your circumstances.
The Trust SSAS
provides a means of pension saving that runs alongside your limited company and
allows for investment decisions to be made by the business owners who are also
the scheme Trustees and Members.
How we can help
Sestini &
Co Pension Trustees Ltd provide bespoke pension administration services to
support business owners who want to take control of their retirement savings
and align them with the needs of the business.
Whilst a
professional Trustee cannot provide financial advice, we will work alongside a
wealth manager to provide a seamless service tailored to your needs.
With our
combined pension and taxation expertise we are ideally placed to support the
bespoke pension needs of business owners by bringing our experience and
foresight to bear to provide a flexible SSAS pension for your business.
If
you would like to discuss your options in relation to a SSAS, call us on 01761
241 861 or email us today. We
will be pleased to advise you or to invite you into our offices in Paulton,
near Bristol and Bath, for a consultation.
