Money Management articles from May 2005

Money Management archives from May 2005

Look Pru's back.
May 1, 2005... PRUDENTIAL HAS RETURNED TO the guaranteed critical illness rates market two years after hastily withdrawing amid accusations and acrimony. It has taken advantage of improved reassurance conditions -- in this case through RGA -- to offer...

Rogue advisers could Costa lot.
May 1, 2005... UNSCRUPULOUS FINANCIAL ADVISERS IN Spain may target vulnerable overseas property investors seeking to take advantage of A-Day SIPP rule changes. The industry is concerned that next April's pension simplification, allowing the inclusion of...

Slipping standard.
May 1, 2005... STANDARD LIFE'S SELF-IMPOSED omission from our 30-year with profits survey last month obscured a mixed bag of results that will not impress policyholders. The life office initially declined to participate in our survey, citing the fact...

A-Day surprise.
May 1, 2005... PRE A-DAY PLANNERS ARE being warned not to get caught out by Budget changes to pensions simplification rules. Employers and trustees were granted an extra two years to change the terms of their occupational pension schemes in line with the...

It's a money old game.
May 1, 2005... PREPARATIONS ARE WELL under way for this year's Money Management Finance Fives competition, due to take place on 1 July on the hallowed turf of London's Mill Hill. Teams are welcome from all areas of the finance industry, from IFAs to...

ISA slice cut.
May 1, 2005... THE TRADITIONAL LATE surge of ISA sales arrived in the nick of time but, at the time of going to press, overall figures look set to remain down on previous years. The expected tax season rush to the market was preceded by the slowest...

Blast from the past.
May 1, 2005... IN MAY 1980, MONEY Management published its second ever with profits survey, reporting a decade of results. As LAPR (Life Assurance Premium Relief) applied to policies in those days, returns were handsome; 84% of the life offices increased...

Three-piece suite.
May 1, 2005... The launch on 6 April of the new types of stakeholder products in the final wave of the Sandler suite caused hardly a ripple in the market. Deposit accounts, medium-term investments (unit trusts or similar investments) and a smoothed...

Young vintage portfolios.
May 1, 2005... Two portfolio services have been launched that can benefit IFAs in contrasting ways. Friends Provident's Dynamic Portfolio Planner is a web-based investment portfolio management tool designed specifically for IFAs. It facilitates risk...

NEW GOLD BOND.
May 1, 2005... US financial services giant The Hartford has launched its first product for the UK retail market. The firm has introduced a flexible unit-linked investment bond designed for retirement savings and long term investments. Hartford Gold...

Not very appealing.
May 1, 2005... Tucked away at the end of a press release from the FSA issued on 30 March was the announcement that it has been decided not to introduce an appeals procedure to the Financial Ombudsman Service (FOS). The reasons given for this were that the...

Dealing with student debt.
May 1, 2005... As with pensions, the burden of financing university education is increasingly being passed to the individuals who stand to benefit from it -- the largely unaware and unrepresented young of today and tomorrow. Many commentators applaud the...

Budget 2005.
May 1, 2005... WITH AN ELECTION ON ITS way, it was hardly surprising that the Chancellor did not announce anything too controversial in this year's Budget. Indeed, Gordon Brown was able to provide a couple of sweeteners for the electorate. But first, a look...

Cheap at HAlf the price.
May 1, 2005... EVERYWHERE YOU TURN AT THE moment there seems to be a sale on. We have had the Christmas sales, and the January sales. Then there were the Easter sales. We even have shops now with all year round sales. Everyone loves a bargain, and many people...

INVESTMENT SPOTLIGHT: Taking stock.
May 1, 2005... Many investors, and some fund managers, were persuaded by the long bull market that dividend income was unimportant. Said to be tax inefficient, bankers and boards of directors were happy to decry the paying of a dividend, promoting instead the...

Taking the middle road.
May 1, 2005... Legal & General has launched the third in its series of capital and growth protected plans, aiming to offer returns of at least 24% after six years. The structured product is split between term bonds and equity derivatives, and will either...

MORTGAGE SPOTLIGHT: M for misdemeanours?
May 1, 2005... No doubt, it is too early to assess how the new mortgage regime is panning out. Nevertheless, with all the hoo-hah over initial disclosure documents and key fact illustrations (KFIs), it is ironic to hear that charges appear to be rising....

PENSIONS SPOTLIGHT: Will you still feed me when I'm 94?
May 1, 2005... How long people will live is an increasingly vital factor for companies, for annuity providers and for individuals with pension plans, or other means of providing for their retirement. Many individuals will not have realised that longevity risk...

SSAS: the way to do it.
May 1, 2005... Superficially at least small self-administered schemes (SSASs) seem to have struggled to maintain a toehold in the pensions market over recent years. Uncertainty over the implications of A-day has helped to push SSASs out of the spotlight...

Top TEPs.
May 1, 2005... THE MARKET FOR TRADED ENDOWMENT POLICIES (TEPs) has dramatically changed in the last couple of years. In 2003, when Money Management last visited the subject, the market was seeing a glut of policies as falling bonuses and surrender values and...

Forward to April 2006.
May 1, 2005... A-DAY, 6 APRIL 2006 -- THE appointed date when all UK pensions will be brought under one single tax regime -- is less than a year away. Over the past few years, there has been much debating and deliberating over the Government's plans for...

All change.
May 1, 2005... AS EXPECTED, THE CHANCELLOR'S Budget contained few pronouncements about pensions. However, there were three changes of note. First, the earnings cap for 2005/2006 was announced as AGBP105,600. Not only that, but the cap for members joining...

A welcome alternative.
May 1, 2005... ONE OF THE SERIES OF CHANGES that will be introduced under pensions simplification relates to how money can be drawn from a pension arrangement. In particular the big news was that the requirement to purchase an annuity by age 75 was to be...

UK commercial property.
May 1, 2005... The F&C Commercial Property Trust is a new Guernsey-registered fund, listed on the London Stock Ex-change. It is structured as an investment company in order to directly hold UK commercial property. The fund already holds 30 properties...

Are you ready?
May 1, 2005... AS THE FSA's DEADLINE FOR depolarisation approaches there is growing concern that firms will not be ready, but an FSA attempt to ease the transition has only added to the confusion. From 1 June, all advisers must comply with all new rules...

So it's goodbye to FURBS.
May 1, 2005... SIMPLIFICATION HERALDS MAJOR changes to the pensions tax regime governing higher earning employees and effectively removes the 'earnings cap'. While senior executives will still benefit from unfunded unapproved retirement benefit schemes...

Best to be prepared.
May 1, 2005... BECAUSE THE NEW TAX REGIME from 6 April 2006 is largely based on the existing personal pension regime, it has less of an effect on personal pension/ stakeholder scheme employers and members than it has on occupational pension schemes and other...

Occupational hazards.
May 1, 2005... THE IMPLICATIONS OF PENSIONS simplification will be far reaching and with contracted-in money purchase schemes (CIMPS) and contracted-out money purchase schemes (COMPS) in the occupational pensions sector, there is much work to be done to...

DIY pension planning.
May 1, 2005... IT IS WIDELY BELIEVED THAT THE popularity of self-invested personal pensions (SIPPs) is set to rise with the introduction of the new pension regime next April. But for the many thousands of SIPP holders who have already taken advantage of the...

Ploy of the Rovers?
May 1, 2005... THE DTI's CONFIRMATION within days of the Pensions Protection Fund (PPF) launch that MG Rover would go into administration was not a coincidence that passed unnoticed. The PPF, which is aimed at protecting workers' pensions when companies...

Let the good times roll for AVCs.
May 1, 2005... AVCs ARE BACK ON THE MAP FOR tax-efficient and flexible pension planning. From A-Day all AVCs can provide up to 25% tax-free cash, irrespective of the date of joining the scheme. It will also be possible to take the entire tax-free cash...

Executive decisions.
May 1, 2005... EXECUTIVE PENSION PLANS (EPPs) have a special role to play in the run up to A-Day for those who want to maximise tax-free cash entitlements in excess of the new limit of 25% that will apply to all registered (approved) pension arrangements. ...

From Australia to Zurich.
May 1, 2005... A n Australia is one of the pioneering wrap markets. They have been used for about 15 years and are responsible for over 70% of fund's inflows. 110,000 Australians now invest in non-superannuation wrap accounts. The effect for advisers that...

Last chance saloon.
May 1, 2005... THE RADICAL OVERHAUL OF THE UK pension system -- known, ironically some would say, as pensions simplification -- will from April 2006 bring in line the many various historic pensions policies and their specific rules into one single regime. A...

Peace of mind?
May 1, 2005... Lifetime mortgage specialist Norwich Union has launched its first home reversion product, with built-in guarantees to offset against early death. The plan offers an 'inheritance protection guarantee', which provides for between 55% to 90%...

Trivial pursuit.
May 1, 2005... COMMUTING TRIVIAL PENSIONS IS a great opportunity to benefit from pre A-Day planning. Pay in extra cash now, get basic rate tax relief added, then, come next April take it all as cash. How it works The trivial pension level is being...

What is a wrap?
May 1, 2005... WRAPS HAVE BEEN WITH US NOW for about three years; in the greater scheme of things that is a relatively short period of time if you compare it with how long they have been around in the US, Australia and Canada. During their brief UK history...

Embracing change.
May 1, 2005... A GOVERNMENT PAPER PUBLISHED in February stated that the new pensions regime would be "simple for individuals and for businesses -- saving the latter AGBP80m year". Many an eyebrow was no doubt raised at this, now that the full implications of...

Platform barriers.
May 1, 2005... IFAs ARE CONVINCED BY THE argument but most have opted against buying into it, instead continuing to wait for wraps to revolutionise the UK retail investment management sector. There is little doubt that IFA interest is substantial, but many...

Wrap to the future.
May 1, 2005... NOT SO LONG AGO, IF YOU HAD asked anyone what a wrap was, you would most likely have been guided in the direction of the nearest deli, record store or textile shop. A wrap that had anything to do with financial advice might have been a vaguely...

Advice on the shelf.
May 1, 2005... SUPERMARKET GROUPS selling off-the-shelf protection products are coming under fire over concerns that consumers are buying unsuitable cover. Sainsbury's Bank, which sells life cover provided by Legal & General, is alongside other groups...

IFAs draw short straw again.
May 1, 2005... WHEN THE FINANCIAL Services Compensation Scheme (FSCS) made its initial forecast in January for the 2005/2006 levy, it predicted that it would need over AGBP200m to cover its own budget and potential claims from consumers. This figure has...

Two problems, two solutions.
May 1, 2005... "CURRENTLY, THE FIRM IS representing individuals and institutional investors who suffered substantial losses as a result of the April 2000 high technology stock crash. The firm is also representing individual investors in claims against their...

Red, yellow or blue?
May 1, 2005... PENSIONS AND SAVINGS are key issues in the upcoming general election. Labour has based its strategy on means-testing in order to help the poorest pensioners but critics say that this discourages savings among lower earners. More proposals...

BBB faces FSA probes.
May 1, 2005... TROUBLED IFA BERKELEY Berry Birch is fighting further FSA investigations after it emerged that one of its directors was being probed by the regulator. BBB director Michael Cleary is being investigated by the FSA over his role in the...

FPoY Awards.
May 1, 2005... ACCOMPANYING THIS ISSUE of Money Management is the supplement that contains the case studies for the 2005 Financial Planner of the Year awards. The event, now in its 10th year, will be held on Thursday 13 October at London's Dorchester...

PFS democracy fears.
May 1, 2005... THE PERSONAL FINANCE Society is feeling the heat once more from disgruntled members just four months after launch. Members of the PFS -- which was formed in January by the merger of the LIA and the Society of Financial Advisers -- are...