Carbon Farming

Is your pension under - performing?

An increasing number of people may be forced to delay their retirement plans because of the impoverished state of their pensions caused by the ongoing financial crisis. Pension funds have been affected by the stock market falls, and those who confidently assumed that their property would subsidize their retirement have seen their house prices fall. Add to this the fact that annuity rates have also fallen, due largely to increased longevity and declining gilt yields.

As a result, many of those who are fast approaching retirement are suddenly aware that their pension fund isn't sufficient to provide the standard of  living required during their retirement. This leaves them in the invidious position of either delaying retirement and working longer or accepting a far lower standard of living in retirement. So if you are approaching retirement and find yourself in this position, there are steps that you can take which may improve your pension situation.

Firstly, we believe that it is essential that you receive professional advice so that you can assess your options. You also need to take measures which aim to protect your existing pension funds from any further sudden market falls.

Should you keep your investments exposed to the stock market and hope there will be a recovery between now and your retirement date?

 
Your decision will depend on your attitude to risk for return, whether you have any other pensions or investments to fall back on and how long it is until you retire. Some may even consider delaying their retirement for a year or two hoping for a recovery in the stock market.

 
Retirement for many today is rarely an all-or-nothing decision, where one day you are collecting a salary and the next your pension plan is converted into a fixed income for life. While your pension fund may not be big enough to buy you sufficient income today to provide the standard of living you want, you may still be able to achieve this in future if you look at 'phased' options.

This may mean working part-time, doing consultancy work or taking a retirement product that enables all or part of your pension fund to remain invested, potentially giving you a higher income in future

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It's not only your pension you need to consider. Do you have other savings and investments that can be used to supplement your income?

In the current recessionary climate, many are concerned about deflation.But if the economy does pick up again, either this year or next, then inflation could once again become a big problem, particularly given the government's recent strategy of quantitative easing, or 'printing money'. Inflation can be particularly damaging to those on a fixed income, as it means that, in real terms, the buying power of your pension decreases.
 
There are a number of ways to 'inflation-proof' your pension, although all come at a cost, usually of receiving a lower starting pension. But if inflation does take off, then these could prove to be a good option.
 
Make your Pension Work Harder With Jatropha

 
Why not transfer some or all of your pension funds into a Self Invested Personal Pension (SIPP) scheme? We recommend an independent advisors that can take care of the transfer for you so you can sit back and watch your investment in Jatropha trees grow year on year, tax-free.

Here are just some of the reasons why investors are transferring underperforming pensions over to a SIPP and then investing in the Jatropha programmes.

 
All incomes earned are free of tax when investing via a SIPP
All contributions are net of tax

Re-invest each year's returns to compound your gains

Our recommended IFA can assist with transferring your pensions into a FSA-approved SIPP.

If you don't currently have a SIPP but are interested in starting one, one of our advisers may be able to help, give us a call for an inpartial discussion on how this can be arranged.

Tax treatment

Contributions to SIPPs are treated identically to contributions to personal pensions. Individual contribution will receive automatic basic-rate tax-relief; higher-rate taxpayers can claim additional relief through their tax returns. As with all pensions, you get income tax relief at your highest rate for all contributions, so that a higher rate taxpayer could invest £10,000 and get a tax rebate of £4,000 meaning that the investment of £10,000 has only cost them £6,000. But all earnings within the fund are based on a £10,000 investment.

Jatropha investment through your SIPP would provide quite unbelivable compouding growth, as income generated from assets (Jatropha trees) within the scheme go untaxed as would any Capital Growth.capital gains tax (CGT).

Investors can invest up to 100% of earned income up to the annual allowance of £235,000 for the 2008/09 tax year.

WHY WAIT ANY LONGER, THINK ABOUT YOUR FUTURE AND YOUR CHILDRENS CHILDRENS FUTURE. CALL OUR OFFICE TO SPEAK WITH OUR FSA REGULATED SIPP ADVISOR OR ALTERNATIVELY FILL IN THE REQUEST FORM AND WE WILL CONTACT YOU.  MAKE A DIFFERENCE TO THE WORLD AND YOUR FAMILYS FUTURE, THINK GREEN !!!!!!