The Collective Retirement Account from Skandia

The recent changes announced to the UK pension regime by the Coalition Government will start to come into effect from the beginning of the 2011/12 tax year. These changes will include a simplified set of contribution rules linked to the carry forward of unused Annual Allowances, which we believe will provide a significant stimulus to the use of a pension wrapper as part of a customer's retirement planning strategy.

Skandia Investment Solutions offers the Collective Retirement Account as its registered pension scheme. In line with the other parts of Skandia's platform, the Collective Retirement Account has been designed to provide a simple but comprehensive solution for customers.

The Collective Retirement Account's charging structure is the same as other tax wrappers on the platform, which makes it very simple for customers to understand. Customers pay the fund TER plus the annual £52.32 Skandia Investor charge – this is a single charge, so if a client holds multiple tax wrappers on the platform, they will only pay one £52.32 charge.

The breadth and quality of the investment range available through the platform combined with the integrated portfolio planning tools makes the Collective Retirement Account an essential part of a customer's retirement planning strategy. The platform provides a robust and repeatable investment process that enables an adviser to construct pension portfolios able to meet the needs of each individual client and provides a range of tools designed to help assess whether or not each customer's needs continue to be met.

The Collective Retirement Account enables customers to build-up their pension savings through the payment of contributions and/or the consolidation of existing pension savings. When customers wish to start using their pension savings to deliver a retirement income, they can use the same Collective Retirement Account to provide this in a choice of two ways.

The first way involves buying an annuity by using the open market option – available at no administrative cost within the Collective Retirement Account. The second method enables customers to access income withdrawal arrangements in one single event or by 'phasing in' over a number of years. Where a customer wishes to take income withdrawals there will be an annual charge applied (currently £54.24).

Currently a customer must be aged under 74 to be eligible to take out a Collective Retirement Account and they must take any tax-free pension commencement lump sum before their 75th birthday. Having done so, they are able to take income withdrawals beyond their 75th birthday, one of the key developments of the Government's announcements on 9th December 2010.

Skandia Investment Solutions provides access to a simple charging structure, a wide and consistent fund range across all tax wrappers, a comprehensive and robust investment process and a single view of a customer's entire portfolio, which together help customers take control of their wealth. When you also factor in the flexible structure of the Collective Retirement Account itself, then you have a high-quality one-stop pension solution that will form the cornerstone of any retirement planning strategy.

Adrian Walker
Head of Retirement Planning
Skandia

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