Pension Transfer Workshop eworkbook July 2018 version 3.3

Transcription

1 Pension Transfer Workshop eworkbook July 2018 version 3.3 Name Course Trainer Date 1 P age

2 Interactive Index Contents Interactive Index... 1 Workshop Objectives and Agenda... 1 Session 1 - Licence Validation for Pension Transfers... 2 Session 2 - FCA Stance... 3 Session 3 - The Pension Transfer Process... 4 Part 1 - Fact Finding... 4 Pension Transfer Case Study - Barbara... 5 Part 2 - Gathering the information... 6 Part 3 Obtaining comparison quotations... 7 Part 4 Case Analysis... 8 Part 5 Preparing case for pre-approval... 9 Part 6 - Submission Part 7 Track position Part 8 - Review Session 4 At Retirement Part 1 - Pensions Freedom What s changed? Part 2 - Advice Process At Retirement Advice Principles At Retirement Knowing your client & Research & Requirements At Retirement Documentation & Presentation and Submission At Retirement Proposition at a glance At Retirement Hybrid (Blended) recommendations...18 At Retirement - Fund Solutions At Retirement - Case Study At Retirement - Case Study At Retirement - Case Study 2b APPENDIX Support for you Pension Transfers & At Retirement Links to useful documents Video User Guides Pension Transfer Calculators Pension Transfer Calculators Links to useful websites & links Intrinsic Apps P age

3 Workshop Objectives and Agenda To understand the FCA stance on pension transfer business To understand the pension transfer process applied within Intrinsic and Positive Solutions To apply the knowledge and skills to a case study To licence you to give Pension Transfer and At Retirement advice 1 P age

4 Session 1 - Licence Validation for Pension Transfers 2 P age

5 Session 2 - FCA Stance FCA Stance Pension reviews should take place Consideration of the Clients Retirement Objective The Adviser must assess the clients current arrangements to establish if they are appropriate for the clients circumstances A thorough fact find and assessment are vital If current arrangements are not suitable then alternatives should be assessed and discussed particularly comparison of costs Stakeholder pensions must form part of that discussion Replacements still remain high risk Documentation is KING 3 P age

6 Part 1 - Fact Finding Session 3 - The Pension Transfer Process 4 P age

7 Pension Transfer Case Study - Barbara Needs & Objectives for Barbara Barbara is aged 55, born 15th December 1960 and married with two grown up children. She is self-employed and runs her own shop with her husband. Due to all the press news around Pensions and what can and cannot be done, she is now looking to have a review of her existing arrangement. She took her Pension out in 2007 but since then has received no advice. From her pension statements she has said she has a number of funds and is worried about the risk to her pension and her plans for retirement. Barbara feels that age 65 is a realistic aim for retirement and is aiming for retirement income in the region of 15,000. She wants to make sure she has flexibility as one of her children is planning to go to university and may need some help! With only 10 years to go to retirement she would like someone to review and service her pension on a regular basis. Barbara has sufficient emergency funds and some other investments that she wants reviewing at some stage, however, she is keen to sort her pension out first. Barbara has completed an ATR and her risk profile is Moderate. She does like the idea of Multi-Manager, Multi Asset and not having all her eggs in one basket. 5 P age

8 Part 2 - Gathering the information Session 3 - The Pension Transfer Process Ceding scheme information and letter of authority Ceding Scheme Information Weighted Average Calculation Fund Information Product Charges Decency Calculation 6 P age

9 Session 3 - The Pension Transfer Process Part 3 Obtaining comparison quotations Old Mutual Illustration 7 P age

10 Part 4 Case Analysis Session 3 - The Pension Transfer Process Maximum Critical Yield Table (Extranet) 8 P age

11 Part 5 Preparing case for pre-approval Session 3 - The Pension Transfer Process Suitability Letter for Barbara Pension Transfer Suitability Letter Case Study 9 P age

12 Part 6 - Submission Session 3 - The Pension Transfer Process Submit your case to BAT using the Pre-Approval Submission Page Fully complete Ensure all the information is correct BAT must pre-approve the case before the transfer forms are sent to the new provider DO NOT GET ANY SALES DOCUMENTS SIGNED BEFORE THEN! This will help the BAT team make an initial assessment of the risk and complexity of the case BAT are there to assist you Pension Transfer Submission Checklist 10 P age

13 Part 7 Track position Session 3 - The Pension Transfer Process Part 8 - Review 11 P age

14 Part 1 - Pensions Freedom What s changed? Session 4 At Retirement Revised Death Benefits 12 P age

15 Part 2 - Advice Process Session 4 At Retirement 13 P age

16 At Retirement Advice Principles Advice Principles Every retirement solution will be client specific The client will be informed of the likely long term sustainability of the income in retirement (or otherwise). The client will always be informed of their retirement options Any recommendation must be appropriate and suitable for the client s objectives and circumstances Short term aspirations must not compromise the client s long term needs An annuity must always be considered as a solution to meeting a client s essential expenses in retirement The income tax implications of the solution must be considered and explained A review service will be recommended for any solution with an investment element Insistent client and execution only cases will not be permitted Every solution will be based on a client s holistic situation 14 P age

17 At Retirement Knowing your client & Research & Requirements At Retirement Supplementary Fact Find 15 P age

18 At Retirement Documentation & Presentation and Submission 16 P age

19 At Retirement Proposition at a glance 17 P age

20 At Retirement Hybrid (Blended) recommendations 18 P age

21 At Retirement - Fund Solutions 19 P age

22 At Retirement - Case Study 1 Elizabeth, 65, Married Has just retired and is in good health She has a personal pension pot of 70k She is in receipt of a state pension of 5k Elizabeth s husband, Fred has also retired and takes his income through a drawdown arrangement Details of your recommendation: She does not enjoy the uncertain nature of Fred s income and is keen to know that she has at least 7,500 guaranteed income come what may Elizabeth has a Conservative ATR 20 P age

23 At Retirement - Case Study 2 Details of your recommendation Brian, widowed aged 66 Has just retired and is in good health He has a personal pension pot of 160k, having already taken his tax free cash He is in receipt of a full state pension which covers his essentials He requires an additional 8,000 p.a.to allow him to live a little and treat his family He has no financial dependents but likes the idea of passing on anything leftover to his Grandson Brian has a Balanced ATR 21 P age

24 At Retirement - Case Study 2b Between meetings Brian has called you up with some further thoughts. Details of your recommendation Brian is still looking for an additional 8,000 p.a.to allow him to live a little and treat his family 6,000 of that original 8,000 he now requires certainty that it will be provided for each of the next 5 years to help fund his Grandson s education After this commitment ends he likes the idea of revisiting his spending needs and objectives 22 P age

25 APPENDIX Support for you Pension Transfers & At Retirement Extranet Product providers for their processes and product information PT Help line P age

26 APPENDIX Links to useful documents Case Check Request Form Suitability Report Templates Ceding scheme information and letter of authority Maximum critical yield table Revised Death Benefits At Retirement Supplementary Fact Find - Editable PDF A guide to when fund research is required BR19 State Benefit Forecast (gov.uk website) 24 P age

27 APPENDIX Video User Guides Pension Transfer Calculators Critical Yield Calculator - Video User Guide Adviser Charging Decency Calculator - Video User Guide Growth Required Calculator Video User Guide Guaranteed Annuity Rate Video User Guide RPI Calculator - Video User Guide Please Note: Each Video User Guide will play in an external window Weighted Average Calculator Video User Guide Tax Free Cash Calculator Video User Guide 25 P age

28 APPENDIX Pension Transfer Calculators Please Note: All Calculators available from the Intrinsic Extranet. Each Calculator is an Excel Spreadsheet and therefore requires Microsoft Excel OR the Microsoft Excel APP (ipad) 26 P age

29 APPENDIX Links to useful websites & links The Pension Tracing Service Pension Wise HM Revenue & Customs Ceding Scheme Example Case Studies & Tips Clerical Medical Ceding Scheme Example Prudential Ceding Scheme Example Zurich Ceding Scheme Example Legal & General Ceding Scheme Example Phoenix Life Ceding Scheme Example 27 P age

30 APPENDIX Intrinsic Apps LifeCash Tax Briefs ATR Profiler The Intrinsic LifeCash app is a lifetime / forecasting tool that supports the adviser in helping their clients identify lifestyle goals in retirement, understand their financial future and build a plan to meet their goals. This app is available from the Apple App store and is compatible with all versions of ipad. The Intrinsic Taxbriefs App provides users with instant access to the latest tax news, UK tax rate data along with useful tax and financial calculators. This app is available from the Apple App store and is compatible with both ipad and iphone. The Intrinsic ATR (Attitude to Risk) Profiler is an independent risk profiling app for Intrinsic Advisers which establishes the appropriate risk category and determine a suitable strategy for the client s investment. This app is available from the Apple App store and is compatible with all versions of ipad. A PC version of this profiler is also available. 28 P age

31 Case Study 1 Answers 29 P age

32 Case Study 2 - Answers 30 P age

33 Pension Transfer Suitability Letter Case Study - Answers Error Spotting Case Study - Answers Completed Pension Transfer Suitability Letter (What Good Looks Like) 31 P age