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  • March 2011
  • January 2011

ae financial services are your local specialist financial advisers. We work with both business and private customers, delivering comprehensive face to face advice, planning and investment.

Tel: Fax:

023 8055 8300 023 8055 8400

Southampton based financial services with clients throughout the UK

 

News - January 2011

Would you let someone who knows nothing about your business have complete control over your employees’ future?

Life expectancy in the UK is increasing – it is estimated that one in four children born today will live to 100 years old. This, paired with a rising percentage of over 65 year olds, means fewer people of working age to support those in retirement.

It is estimated that around 7 million people aren’t saving enough to deliver the income they’re expecting from retirement.

However, this is about to change.

From October 2012, a new set of pension laws will impact on all businesses, whatever their size.

Due to reforms passed under the Pensions Act 2008, employers will be required to automatically enrol all eligible employees into a pension scheme, and pay contributions of at least 3%. This will see up to 9 million people starting to save, or saving more for their retirement, maybe for the first time.

To comply with these new regulations, and avoid substantial fines, employers will have three choices;

1. Put a new pension scheme in place
   To keep full control over their employees’ benefits package, employers can install their own pension scheme with the help of Ae Financial Services Ltd.
   
2. Amend their current pension scheme so that it fully complies with the new regulations
   Some businesses may already have a pension scheme in place. However, this may need amending to comply with the new regulations. Ae Financial Services Ltd can give you advice on how to achieve this.
   
3. Rely on a Government built scheme – the National Employment Savings Trust (NEST)
   NEST is a new pension scheme which works alongside the government, and has been designed specifically to meet the needs of low-to-moderate earners and their employers. There will be specific restrictions applying to NEST:
   
   • A general ban on all pension fund transfers in or out
   • An upper contribution limit (currently £3600 a year)
   • Limited retirement options
   • Limited investment options
   • No advice to staff
     

What should you do next?

All employers are now faced with a number of questions.

• What are the costs, and how will you fund them?
• Does your existing scheme meet the new criteria?
• What arrangements could you offer to retain your higher earners and more valuable employees?
  

Employers should immediately seek fully independent advice from advisers that are experienced and qualified in setting up and managing workplace pension arrangements to answer these questions.

Ae Financial Services Ltd are leading Independent Financial Advisers specialising in the corporate and personal financial planning market. We can:

• review your existing pension scheme to make sure it will at least comply with the new requirements
• advise and arrange for a new pension scheme to be installed if appropriate
• introduce arrangements which can save your business money and offset the financial impact
  

Call Ae Financial Services on 02380 558300 or email info@aeins.co.uk now for advice on the upcoming changes to the law, and to discuss the options for your business.