New Group Pension Scheme Member

Presentation 2011

Presented by

Tony Theokli

Areas for discussion

Why save now?

About your company pension scheme?

What action to take?

YouGov Sixth Sense report

- November 2010

Source: http://today.yougov.co.uk/life/what-stresses-you-out

For intermediary use only – not for use with your clients

Pensions

Interesting?

Sources of retirement income

Sources of retirement income

How Did We Get Here?

A different view towards saving and spending

Shopped at the “Co-Op”

Dined out only on her birthday

Hid cash in her home

Hated to turn on the heating

Covered couches in plastic

Sewed patches on trousers

Wouldn‟t pay to have her car washed

Re-used tea bags

How Did We Get Here? A different view towards saving and spending

Buys designer clothes

Dines out frequently

Stops daily at Starbucks

Travels first class

Leases a new car every two years

Valets his car regularly

Holidays in the Caribbean

Buys the latest and greatest electronics

The Result

A generation that is over-borrowed,

under-saved, unprepared, and . . .

is ready for its comfortable retirement.

©2006 Bates Millfield

“I‟ll be looked after by

the government – I

don‟t need to worry

about it now”

Why save now?

“My money‟s tied up

with day-to-day living

expenses – I can‟t

afford to save at the

moment”

“I‟m too young to

start a pension”

“I‟m too old to start a

pension plan”

“I don‟t understand all

this financial stuff”

Why save now? “I’ll be looked after by the government – I don’t need to worry about it now”

• People are living longer

• Your expenses may not reduce as much as you think

• The State Pension may not be enough

Basic State Pension:

£102.15 per week - single person

£163.35 per week - married couple Source: HM Revenue & Customs 2011*

S2P (Previously

SERPS)

Pensions

Credit

State Pension

* Assumes a full national insurance contribution record. www.thepensionservice.gov.uk/home.asp

£249,000 Account Value

A

£167,000 Account Value

B

Today 10 years 20 years 30 years 40 years

This illustration demonstrates the effect of compound interest on current versus delayed investments. It assumes

contributions are made at the end of the month and that the investment earns a hypothetical 6% p.a. nominal rate

of return compounded monthly (6.17% APR) and 20% tax relief. It does not reflect the return of any investment,

which will fluctuate and does not reflect charges.

Waits 10 years and tries to catch up by contributing £133.33 a month net for 30 years

Starts now and contributes £100 a month net for 40 years

The potential cost of delay “I can’t afford to save at the moment”

Your retirement

0

20

40

60

80

100

1850's 1907 1957 2007

Year

Nu

mb

er

of

ye

ars

Men

Women

Life expectancy for men and women from birth

Source: Office for National Statistics & Government Actuary‟s Department

Fact!

Life expectancy in the UK is currently increasing at

a rate of 5 hours every day

Being 79 today is the physical equivalent of being

65 in our grandparent‟s generation

The first person to reach age 150 is already alive

today!!!!!

Source: The Observer, June 10, 2007

About the plan Look forward to a better retirement

If you join the Plan: • You have an individual policy with Scottish Widows

• You decide how much you pay

• You decide where you invest your contribution

• You decide at what age you draw the benefits

• Payroll deduction facility makes the

payment process simple

* Please note that the value of the funds, including any default fund, may go down as well as up and you may also

receive less than the amount contributed by you.

How the plan works

Contributions:

You + HMRC

Investment

returns *

Pension

account

on retirement

Tax free cash

(optional)

Remainder of

the fund used to

provide taxable

pension income

You pay

Total Gross Contribution £200.00 pm

£40.00 pm

£160.00 pm

Basic rate tax relief added

Your contributions

Example funding – for illustration purposes only

Higher rate taxpayers would also receive an additional 20% tax refund from HMRC resulting in a Net contribution of £120.00 per month

In the 2011/2012 tax year…

* For the 2011/2012 tax year. The annual and lifetime allowance limits apply to the total of all an individual’s

pension arrangements. These include contributions made by an individual and their employer. There are tax

charges where the above allowances are exceeded.

You can save the greater of £3,600 and 100%* of your total earnings

This is subject to an annual limit of £50,000*…

…And an overall lifetime allowance of £1.50 million*

How much can you save?

Cash investments offer the most security

but may not grow fast enough to keep pace

with inflation

Also known as „gilts‟ when issued by the

UK Government, bonds represent loans to

companies or governments that are repaid

with interest to investors over time

Also known as „stocks and shares‟,

equities represent part ownership of a

company, including its earnings and

assets

Return

Risk

Equities

Bonds

Cash

Investment basics Reap the rewards from investments

The road to retirement How long do you have until retirement?

This graphic is not intended to recommend a specific course of action for you. Each

person would have to consider their own attitude to risk in the context of their overall

retirement and private financial planning.

Retirement

Distance

>20 years

10-15 years

5 years

Equities

Equities/Bonds

Bonds

Bonds/Cash

Fund A Fund B

Fund C Fund D

Fund E

Investment funds choice

Property 25%

Equities 25%

Cash 25%

Gilts 25%

Asset classes

40

25

20

5 5 5

Global Emerging Markets

Japan Far East

USA Europe

UK

Geographical spread

There is a default fund, where your contributions will

be directed, if you don‟t actively select where you

wish to invest…

Scottish Widows Balanced Managed

The default investment fund

• Note: This may not meet your needs or attitude

towards investment risk • The annual management charge for this

fund is 1.00% pa

Fund 1

Fund 2

Fund 3

Fund 4

Fund 5

Fund 6

Fund 7

Fund 8

Fund 9

Fund 10

Portfolio diversification

Average annual management charge of 1.79% pa

Our approach to spreading the investment risk

Higher risk,

higher return

potential

Lower risk,

lower return

potential

Very Cautious to Cautious

Cautious to Moderate

Low Moderate to Moderate

Moderate to Low Adventurous

Low Adventurous

No Risk

Adventurous

Investment Funds Choice

25% Tax Free Lump Sum

+ Reduced Annual

Income For Life

Taking your benefits

Any time from age 55 – no upper age limit

You do not need to retire from employment

You decide how to take your benefits

Annual Income For Life

What happens if .....

• You can take your benefits with you

• No cost or penalty applied to your fund

• 100% of the fund value paid as a tax free lump sum

• Remember to complete you nomination of beneficiaries form and keep this updated

You die before reaching retirement?

You leave your Employer?

Thoroughly read the information pack, sample illustration, fund booklet and

application form

Decide if you wish to join

Decide how much you want to contribute

Decide on investment funds

Arrange a 1-1 if required

The next steps

How do you join?

When you join you will receive…

• A „Cooling-off‟ period

• Policy documents

• Internet access to your account to view policy details, amend basic details, access information,

and switch funds

Each year you will receive…

• A Statement of account

• Annual meeting

Return the paperwork to Tony Theokli

Complete the application paperwork within your pack

Get your future on track today !

Q & A‟s

Sherborne House 119 Cannon Street London EC4N 5AT

Direct Line: 020 7743 9113 Mobile: 07770 593943 Direct Fax: 0844 5791814 Email: tony.theokli@templebar-am.com

Thanks for listening

Temple Bar Asset Management Ltd

Important information

Temple Bar Asset Management Limited are independent financial advisers. We provide advice to Simply Business and its employees on the company pension

scheme. This presentation is for information purposes only and should not be interpreted as

a recommendation or advice. This presentation is based on our understanding of current pensions legislation,

taxation law and HMRC practice. Benefits are not guaranteed and the value of investments may go down as well as

up. Temple Bar Asset Management Limited is a trading name of Honister Partners

Ltd. Honister Partners Ltd is an appointed representative of Sage Financial Services which is authorised and regulated by the Financial Services Authority.