Final Salary schemes -
With employee benefit consultants charging
the earth for what is often a poor service
it is important to take stock of both costs
We believe we can save the company pension
considerable costs by "bundling up"
the pension scheme. Using a third party
administrator effectively adds an extra
tier of costs that we feel can be avoided.
By using our services we will place you
with the most appropriate life company,
which will replace the role of the third
party consultant and due to the fact that
they hope to manage some of the funds then
they will subsidise the cost of administration.
The result is that you should save up to
80% of your current costs.
We are happy to offer a no win no fee service
to establish if such savings are open to
Service is an issue that has two aspects
1. The service the Trustees get.
2. The service the members and ex members
The service the Trustees get is easy to
assess, as this is something you deal with
on a regular basis. However, the service
that current members and ex members get
is much harder to quantify and is best indicated
by the take up of the scheme and the extra
contributions that are paid into the AVC
The service the members get reflects on
the company and poor service undermines
the purpose of offering a company pension
By offering a pension scheme you want to
help ensure that your employees are well
catered for in retirement. Consequently
you pay enormous costs both in funding and
support to provide such schemes. Yet, if
you do not provide the support then you
run the risk of "ruining the ship for
a ha'peth of tar"
Retirement planning and
For many years employers have looked after
their employees with very generous pension
schemes and then when they come to retire
there is noone to give them very basic help
about the pension scheme benefits. Most
employees want to know whether they are
better to take the maximum cash or maximum
pension at retirement or they want to know
whether there are any alternatives to taking
the annuity in the prescribed format.
There are several problems for Trustees:
1. Advice - only FSA authorised individuals
can give advice.
2. Cost - employing an authorised IFA can
be very expensive.
3. Integrity - ensuring that the IFA has
the employees' best interests at heart.
Due to these difficulties employers and
Trustees have tended to dodge the issue
and do nothing. This means that employees
with little understanding of what the implications
are either make decisions themselves or
they get financial advice elsewhere. This
could lead to a conflict of interest as
it may be in the financial advisers' interest
to recommend that the maximum tax-free cash
be taken as that gives more money to invest.
However, with the current markets the way
they are it is often in the employee's interest
to maximize the pension.
Existing employees and those coming to
retirement need quality independent financial
advice. The best advisers work on a fee
basis, which ensures that the adviser is
looking after the employee's interests.
This can be very expensive for an individual
but is very cheap for a company to provide
as regulatory work required for the IFA
is much less if the company is appointing
One very cost effective solution is to
book an IFA to do one day sessions for retiring
or existing members. Working on the basis
of 20 minutes per employee we can see up
to 20 people in a day giving very basic
advice on what their options are and generally
point them in the right direction.
With easy to complete feedback forms the
Trustees can monitor the competence and
honesty of the IFA.
The number of one day sessions booked will
depend upon the number of employees coming
to retirement and enthusiasm with which
the sessions are viewed.
Cameron Financial Services pride ourselves
on the honesty and quality of our counselling.
The Inland Revenue will allow a payment
of up to £150 per employee per annum
for financial advice without it counting
as a benefit in kind providing it is a service
that is offered to all employees.
By offering an in house service you will
find employees get enormous benefit from
what is a very small investment.
The fact that you offer retirement counselling
will be very popular with employees and
can be promoted widely giving you the kudos
of being a caring employer at a cost less
than that of a part time administrator.
This service can be expanded out to all
staff so that if they have a pension query
they can book into one of the seminars and
have a session to answer any queries that