KEY FEATURES OF A MAURITIAN EXTERNAL PENSION SCHEME

Transcription

1 KEY FEATURES OF A MAURITIAN EXTERNAL PENSION SCHEME

2 OPEN YOURSELF TO A WORLD WHERE YOU HAVE THE ABILITY TO SHAPE YOUR LIFE AT RETIREMENT AND BEYOND As you control your career and finances, you should also take control of your retirement and the income you wish to receive at that point of your life. Providing for your retirement is extremely important. State pensions provide only the basic benefits Investing in a pension fund in which you have your say in your investment choice and a comfortable lifestyle for yourself when you retire should be the main concern. HOW DOES IT WORK Non-Mauritian Individuals Mauritius Investment Manager Custodian Members Members Members Contributions Pension Scheme represented by governing bodies Pension Scheme Administrator INTRODUCTION This External Pension Scheme (the Scheme ) is a defined contribution scheme which is regulated in Mauritius, by the Financial Services Commission ( FSC ), with the primary objective of providing pension benefits to its members. Established as a trust, the Scheme offers a flexible and tax-efficient solution for retirement planning. It is exclusively designed for non-mauritian residents and enables individuals to provide for their retirement in a flexible and cost-effective manner. It allows you to relocate all your funds in one vehicle and answers your needs of succession planning. It can accept transfers from existing or previous pension arrangements and is funded through contributions from its members. Worldwide Non-Mauritian Individuals Auditor Actuary Shares investment Foreign Jurisdiction Pension Benefits Beneficiaries Beneficiaries The PPS will need to be audited by a qualified auditor and an audited financial statements will need to be submitted to the FSC Actuarial valuation to be undertaken periodically to ensure funding levels. 3

3 UNLOCK THE KEY BENEFITS OF THE SCHEME INVESTMENT CHOICES CONTROL A private pension plan is an option to bolster one s retirement benefits and forms but one element of a holistic retirement plan. You decide on your retirement strategy and investment choices to suit your personal needs and achieve your retirement goals. FLEXIBILITY The Scheme is a defined contribution one where you can contribute any amount unless determined otherwise by the constitutive documents. INVESTMENT OPTIONS The Scheme provides greater flexibility of investment choice with a strategy tailored to match your risk appetite. RETIREMENT OPTIONS There is a number of retirement options available to you to plan an income for yourself and your dependents. The Scheme provides you with retirement benefits that intrinsically depend on how much money has been built up by ACCESSIBILITY The Scheme is licensed as an external pension scheme and will have principally foreign investments. It provides the following investment choices to its Members: ASSERTIVE: For members who accept to take substantial risk. This profile of members should be willing to assume a significant level of portfolio volatility and risk of principal loss. A typical portfolio will have exposure to various asset classes but will be heavily weighted toward equities (with a maximum weight of 100% of this asset class). BALANCED: For members who are willing to take a moderate level of risk. Primary structured products and others with a modest allocation to equities (with a maximum weight of 40% of this asset class). The default investment choice is the balanced one. The asset allocation strategy of the Scheme can be summed up as follows: ASSET BREAKDOWN TYPE Equities Fixed Structures Loans OF RISK PROFILE: (or Equity funds) Income (or Bond funds) & Cash Products and Others Assertive 20% - 100% 0-60% 0-25% 0 15% CHOICE You can choose to contribute in the Scheme whilst also contributing into an Employer-sponsored scheme. PORTABILITY You can transfer your contributions to any other pension scheme after completion of two years in the Scheme. CONSOLIDATION You can consolidate any number of pension arrangements you have under a single roof. PEACE OF MIND You contribute according to the lifestyle you wish at APPLICABLE LAWS Members can have on-line access to review their capital/investment accounts. LOW-COST Efficient administration services and low charging structure. OWNERSHIP The pension benefits belong solely to you and your appointed beneficiaries. They are protected from creditors in the case of insolvency. SUCCESSION PLANNING Members have the ability to pass on the pension fund onto identified beneficiaries upon death of the Member. emphasis will be to strike a balance between portfolio stability and portfolio appreciation. Members using this model should be willing to assume a moderate level of volatility and risk of principal loss. A typical portfolio will primarily include a balance of fixed income, may be structured products and others and equities (with a maximum weight of 60% of this asset class). DEFENSIVE: For members who are somewhat risk-averse. The primary focus will be to achieve a modest level of portfolio appreciation with minimal principal loss and volatility. Members using this model should be willing to absorb some level of volatility and principal loss. A typical portfolio will include primarily cash, fixed income investments, Balanced 0-60% 20% - 100% 0-20% 0 15% Defensive 0-40% 0-100% 0-15% 0 15% As you approach your planned retirement years, the mix of investments will become more balanced or conservative as they move towards a more cautious approach. The cautious investments will be cash and fixed incomes. The investment returns will probably be less than equities over the long run but may help protect your savings as you get nearer to Please note all of these funds can go down as well as up and past performance is not a guarantee of future performance. The Scheme is governed by the laws of Mauritius. 5

4 THE KEY TO IMPORTANT INFORMATION RETIREMENT BENEFITS The trustees will contact you one month prior to you attaining the appropriate retirement to complete the Contribution for Additional Interests form which comes together with the Membership Form. Trustees would consider payment of the benefits to the Member based on accumulated fund at such event. ADDITIONAL CONTRIBUTIONS You can increase your benefits by age with a personal benefit illustration outlining the options available to you at Your pension benefits depend on the fund accumulated in your pot at the time of retirement and is equal to the amount determined by the Scheme. Please find hereunder the options available to you at retirement: EARLY WITHDRAWAL Investment in pension is a long-term process and you should aim to hold on liquidating your assets at the time of On early withdrawal from the Scheme, you may incur certain charges and is only possible after completion of 2 years Membership in the Scheme and the options available at the time of opting out from the Scheme are as follows: DEATH Upon receipt of proof (Death certificate) satisfactory to the Trustees of the death of the Member before the annuity has come into payment, the Trustees shall pay a lump sum which is equal to the value of the Member s Interest as set out below: to pay a lump sum benefit to the Member s estate; and/or paying additional contributions to purchase an enhanced pension benefit, or by making payments to the scheme s additional contributions arrangement. BENEFIT STATEMENTS These statements are issued on an annual basis to each Member of the Scheme and provide an illustration of the projected pension benefits of the (a) a pension payable for a lifetime; or (b) a reduced pension payable for a lifetime and a lump sum amounting to no more than 25% of your Interests; or (c) Either options (a) or (b) above and a pension benefit to the member named beneficiary(ies) in the case of death; or (d) Annuities may be increased subject to satisfactory investment returns; or (e) Either options (a) or (d) above payable by a licensed Insurance Company in Mauritius; or (g) transfer the whole or any part of the annuities to the trustee(s) of any other trust The pension can be paid on a monthly, quarterly, half-yearly or annual basis (as per Scheme Rules). You will have the option to choose the mode of payment of your pension at the time of Please note that you can choose only one option when you retire. TRANSFER IN If you have other pension arrangement, then you may be able to arrange for these savings to be transferred in so that you have all your pension savings in one place. You will have Leave all your interests in the Scheme and receive pension benefits when you have reach appropriate retirement age; or Transfer all your interests to another Pension Scheme As a member, you may also be eligible to have your pension paid early on illhealth grounds (as per Scheme Rules). This means that if there were satisfactory medical evidence that you have become so incapacitated to perform your normal duties, you may be able to use your pension fund to retire at any age. You will also benefit of your pension in case of an early retirement, but after some deductions which are payable to the Scheme. In the event a Member becomes so permanently incapable of holding the person s office due to sickness, accident, injury or incapacity through infirmity or mind or body and that such incapacity is proved to the satisfaction of the Scheme s Trustees by a certified medical practitioner, the Scheme s to pay or apply such benefit to or for the benefit of any one or more of the Member s Beneficiaries; and/or such persons or bodies as the Member may have notified in writing to the Trustees (as being persons or bodies whom the Member wishes the Trustees to consider as possible recipients of any benefit payable from the Scheme on the Member s death) in such shares and in such manner as the Trustees may have regard to but shall not be found by any wishes notified to the Trustees by the Member. Once a Member joins the Scheme, we recommend that each Member: nominates one or more Beneficiaries. In the event of death of the Member, the Beneficiaries are required to contact the Scheme for payment of the benefits; and is required to choose the correct retirement option to secure a pension benefit for their dependents in the event the Member predeceases his/her beneficiaries. Member. It also shows the performance of the funds in which each Member s contributions are invested. You may inform the Trustees of any changes you wish to bring to your investment profile on an annual basis. This allows the rebalancing of the investment portfolio. CUSTODY OF ASSETS All contributions are held with the Scheme s custodian and invested by the Investment Manager of the Scheme. Unit prices are linked to the underlying funds which contribute to the overall performance your portfolio. CHARGES Your Capital/investment Account balance will be communicated to you in your annual benefit statement and shall be net of any charges to be paid to the Scheme and its service providers. Please contact the Scheme s Administrator to obtain a list of charges applicable. COMPLAINTS If you have a problem or complaint in connection with your pension or pension administration, we recommend that you initially discuss with the pension administrator of the Scheme. 7

5