Little commonality in the European market

Article Abstract:

Mainland Europe is likely to see a move toward pre-funded pension provision, a practice which is already common in the UK. UK funds account for some 60% of European pension fund assets. The move is likely to be triggered by concern about demographic changes which mean that there will be fewer workers to pay for the pensions of the retired. UK fund managers may not benefit greatly from this move, despite their experience. European institutions often prefer local managers though this is less true for Switzerland, the Netherlands and Belgium.

Commercial Banks, Investment Banking and Securities Dealing, Portfolio & Funds Management, Portfolio management

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The rebate debate goes on

Article Abstract:

The UK government has encouraged investors to leave the state earnings related pension scheme, or Serps, through providing a rebate from social security contributions to be invested in a personal pension. Investors need to save 100,000 pounds sterling for a pension of 10,000 pounds annually. Charges may consume the rebate and savers may be worse off after contracting out, especially if they are on low incomes. There is also doubt as to what the value of Serps will be in decades to come.

Economic aspects

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Flexible annuity brings new risks

Article Abstract:

The UK government is allowing investors to take annuities in a more flexible way through drawing on pension fund income. There are rules established by the UK tax authorities to prevent abuse. This helps people who retire when interest rates are low, as they were in 1993, which affected the value of annuities bought by people in that year. Investors can also buy their annuity from companies other than those they save with, and obtain a better annuity in many cases.

Laws, regulations and rules, Annuities

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