You should read this document carefully so that you understand what you are buying, and then keep it safe for future reference.

Transcription

1 Self-invested Personal Pension (SIPP) This is an important document. Please read it and keep for future reference. Pre-retirement pension fund illustration Your reference: P Your illustration prepared on 13 March 2017 The Financial Conduct Authority is a financial services regulator. It requires us, AEGON, to give you this important information to help you to decide whether our Self-invested Personal Pension (SIPP) is right for you. You should read this document carefully so that you understand what you are buying, and then keep it safe for future reference. This illustration is to give you an idea of what you might get back from your plan over the coming years. The projected amounts that are shown have been based on standard assumptions. They are not guaranteed but give you an indication of how this plan might perform if growth is achieved at the rates shown. Your personal details Name A Example Gender Male Date of birth 01/01/1972 Age 45 Tax rate 20% Your adviser's details Name Iain Chadwick FCA number Company Johnson Fleming Ltd Investment Solutions Ltd is authorised and regulated by the Financial Conduct Authority. Their Financial Services Register numbers are and respectively.

2 Your plan details Plan start date 13/03/2017 Illustrative annuity purchase date 01/01/2037 In this illustration, we have assumed that this date is when you will buy a lifetime annuity with all of your remaining pension fund. Under this plan you can choose to buy an open market annuity at any time from your 55th birthday. Your Financial Adviser will be able to give you further help on all of your retirement options. Your contributions Start date Payment type Amount Frequency Escalation 13/03/2017 Transfer 25, Single payment n/a Standard Lifetime Allowance The Standard Lifetime Allowance is the maximum amount that you can normally use to fund pension payments, without incurring additional tax charges; this is currently 1,000,000 unless you have fixed or individual protection. Your selected investment funds Investment name Percentage to invest Low growth Mid growth High growth Aegon GrowthTkrFlexTgtPn ARC 99.75% -0.73% 2.20% 5.12% Cash 0.25% -3.90% -0.98% 1.95% The growth rates shown above are the rates at which the investments have been projected in the section titled "What might your benefits be at the illustrative annuity purchase date?". When the growth rate we have used is less than inflation, this produces a negative effective growth rate. This shows how over time inflation reduces the buying power of your fund. Annuity assumptions The following assumptions have been made about your annuity: For the purposes of this illustration, your open market option annuity will commence on 01/01/2037. However, you may elect to take your annuity either earlier or later subject to you being aged 55 or over. Your annuity will be paid at the beginning of each month. Your annuity will be paid throughout the rest of your life. Your annuity payments will stay at the same level once payment starts. No annuity will be paid to your dependant in the event of your death. 13 March 2017 Illustration reference: P Page 2

3 What might your benefits be at the illustrative annuity purchase date? The table below shows what your fund might be and the annuity that you could buy with that fund in today s money. We show figures using today s money because inflation reduces how much you can buy in future. Think about how much 500 could buy 20 years ago and then think about what it can buy you today. The same will be true in the future. We have assumed that an inflation rate of 2.5% applies. Low growth Mid growth High growth Fund 18,700 33,300 58,500 Full annuity 706 1,640 3,650 PCLS 4,680 8,330 14,600 Residual Annuity 529 1,230 2,740 Inflation reduces the buying power of all savings and investments products but not all illustrations take it into account. So, be careful when comparing products and check whether they do take inflation into account. Pension commencement lump sum, this is the amount of money you can take as a lump sum when you come to take benefits. The maximum amount you can normally take tax-free is 25% of your fund. However, you may be entitled to more or less than this. For example, if you have a protected pension commencement lump sum. If your total pension benefits exceed your Lifetime Allowance (LTA) you would be liable to pay an LTA charge. 13 March 2017 Illustration reference: P Page 3

4 What are the charges? The charges associated with this illustration are set out below. Where charges are expressed as a percentage, the amount will vary as your plan value changes over time. The next section shows the possible effect of product and investment charges on the way your plan grows, along with the possible effect when all charges are taken. Product charges For setting up and managing your plan: Annual Charge Below 29, % Between 30,000 and 49, % Between 50,000 and 99, % Between 100,000 and 249, % Between 250,000 and 499, % Between 500,000 and 749, % Between 750,000 and 999, % Above 1,000, % Using the charging bands from the table that apply to your funds, we ll calculate an annual charge. How much you pay will vary depending on the value of your overall assets. Based on this illustration this could be 93 in the first year. Advice charges For advice and consultancy services: Ongoing Adviser Charge 0.24% Initial Adviser Charge (Transfers) 0.50% If this charge is a monetary amount, it s stated as a yearly fixed charge. If this charge is a percentage, it s calculated as a yearly percentage of your funds. This charge is deducted proportionately every month. For any charges in this section that are on a % basis the charge will increase as the fund value increases. This percentage charge will be applied to the transfer contribution(s) you re making to your plan after any tax free cash has been taken (if applicable). Your adviser could receive 125. Investment charges For managing your selected investments: Aegon GrowthTkrFlexTgtPn ARC Initial Charge 0.00% Annual Management Charge (AMC) 0.05% Other Charges 0.00% The fund manager will charge you 0.00% as an initial charge. This could be 0. The fund manager will charge you 0.05% each year to manage the fund. Individual funds may have additional annual charges not included within the annual management charge. AMC Rebate 0.00% The fund manager will rebate 0.00% of the AMC each year. Cash 13 March 2017 Illustration reference: P Page 4

5 Initial Charge 0.00% Annual Management Charge (AMC) 0.00% Other Charges 0.00% AMC Rebate 0.00% The fund manager will rebate 0.00% of the AMC each year. 13 March 2017 Illustration reference: P Page 5

6 How the charges can affect your plan Below we show the effect of charges in two ways. In calculating these figures, we have assumed your investments will grow at the mid growth rates shown in the "Your selected investment funds" section. The actual growth rates could turn out to be less than this and you may get back less than you paid in. All providers have to give you this information to help you compare their charges. 1. How the charges can reduce the value of your plan Column 3 shows how much you could pay for advice over the term of your plan. The difference between columns 4 and 5 shows the effect of the product and investment charges. The difference between columns 5 and 6 shows the effect of the advice charges. The last column shows the effect of all your charges on your plan. The last column also shows what you could transfer to another plan At end of year The payments into your plan Cost of advice Before charges are taken If only plan and investment charges are taken After all charges are taken from this plan 1 24, ,500 25,400 25, , ,100 25,800 25, , ,600 26,300 26, , ,200 26,700 26, , ,800 27,200 26, , ,400 27,700 27, , ,000 28,100 27, , ,700 28,600 28, , ,300 29,100 28, , ,000 29,600 28,800 At Age 65 15,300 1,178 38,300 35,100 33,300 The values in the table above take inflation of 2.5% into account, and are shown on a real basis. This means that your contribution may show as reducing in value due to the effect of inflation. The last line shows the effect of deductions over the full term of your account based on your age as at the last day of the final year of the projection. It shows that without charges, your plan could be worth 38,300, and what it could be worth after charges are deducted. 2. How the charges can reduce the growth rate of your plan The reduction from 38,300 to: 35,100 means that just product and investment charges could reduce the yearly growth rate, after taking into account inflation, from 2.2% (based on the mid growth rates of the funds in your plan) to 1.7%. This is a reduction in growth of 0.5% a year. 33,300 means that all the charges could reduce the yearly growth rate, after taking into account inflation, from 2.20% (based on the mid growth rates of the funds in your plan) to 1.5%. This is a reduction in growth of 0.7% a year. 13 March 2017 Illustration reference: P Page 6

7 Important notes Your benefits are dependent upon a number of factors; the amount you invest, the age at which you commence benefits and external influences such as investment returns, inflation, interest rates, annuity rates and charges. The figures illustrated are only examples and are not guaranteed - they are not minimum or maximum amounts. You could get back more or less than this. You may also get back less than the amount that you have paid in. You will be sent annual statements which will enable you to keep track of your plan. The statement will show you all payments received into your plan and payments, including charges, that have been deducted. All companies use the same rates to show how funds may be converted into pension income. Your pension income will depend on how your investment grows and on interest rates at the time you retire. If you were to die before purchasing an annuity, death benefits equivalent to the value of your plan would be paid to your beneficiaries. Depending on when these are paid, tax may be payable. There is an annual limit on the amount that you can pay into your plan without incurring tax charges. This is called the Annual Allowance. This illustration does not take into account any tax charge that may be applicable if this limit is exceeded. If you earn more than 150,000, then your Annual Allowance will be lower due to tapering. Tapering is a gradual reduction of your Annual Allowance for each pound that you earn above 150,000. Special rules applied for the 2015/2016 tax year, for more information on this please speak to a financial adviser. If you have any queries please contact your Financial Adviser. 13 March 2017 Illustration reference: P Page 7