Pension

Five-star rated by Defaqto, our defined contribution – money purchase – pension has benefited from a continuous programme of development, including a newly-enhanced, automated phased drawdown facility. Offering choice, flexibility and great value for money, we believe it provides a compelling solution for your clients’ pre- and post-retirement planning needs. So, let me go through a number of points to help you, your clients and your firm understand the value-added features and functionality we offer and support you in your due diligence process.

How does the pension work?

Within the pension, a client may have a pension savings account – or uncrystallised account – into which all their regular and single payments can be paid. Depending on the benefits they decide to take, they may also have one or more pension drawdown accounts. 

Can client pension accounts be managed online?

Our pension is available within an almost completely online service. So, whether it’s opening a new pension, transferring a pension to us, or administering your fees, this can all be done online. It also features online illustrations and dealing for all transactions. Importantly, the pension is integrated with our other tax wrappers and services.  For instance, it is administered on the same technology platform as our ISA and Investment Account and so you enjoy the same experience across all our product wrappers.

In addition, clients can view their holdings via the Fidelity APP, which can be download to their mobile devices.  The APP allows them to receive documentation, such as statements and valuations, instantly and safely.

What investment choice is available to clients?

A client can hold a wide range of funds, investment trusts, exchange traded products and individual shares within the pension. In fact, your clients have access to over 6,300 different investment options, including a large array of sustainable funds for those who wish to invest responsibly. The investment range is consistent across all our product wrappers and is designed for all adviser investment models, whether you construct bespoke portfolios, use model portfolios, utilise a Discretionary Fund Manager, or prefer to use multi asset or multi manager solutions.

Can you tell us more about using model portfolios within the pension?

You can create bespoke model portfolios of up to 50 investments, taking into account the client’s attitude to risk and whether they require growth or income. The portfolios can be set up for your entire firm to use or can be tailored for individual adviser or client requirements. You can also use models from a Discretionary Fund Manager – over 75 DFMs are available through our platform. We make no charge for this service, although the DFM may do so. 

Can you describe the charging structure of the pension?

One of the features advisers say they like about our pension is the simple and consistent charging structure. There are no set-up or annual administration charges, including for income drawdown. So, for instance, if a client is making withdrawals from their pension, there are no additional charges in much the same way as there are no extra charges for making a withdrawal from an ISA. We just charge an annual service fee of 0.25% and an Investor Fee of £45 per year.  Although there may be additional fund management charges on any investments held; we make no charge on any asset held in the product cash account.

What MI is available to firms?

Another popular feature of our service is all the management information that is available at an adviser’s fingertips. Our Reporting Services facility enables you to find data and client information quickly and through a simple online process. Each report is designed to help you manage your business more efficiently. 

A relatively new report is the Pension Summary Report, which gives you a detailed overview of all your clients’ pension accounts with us. So, for example, you can quickly check to see where Expression of Wish forms are held, and when they were last updated, right across your client bank. Alternatively, you may wish to check your clients’ contributions for the current tax year as you approach the tax year end – or for the previous three tax years so that you can quickly see the position relating to carry forward. All this information is available in a single report, which can be accessed online.

What decumulation options are available to clients?

There are a number of decumulation options, including flexi-access drawdown. Income can be taken as a one-off payment, or regular payments can be made monthly, quarterly, half-yearly or annually. We also support clients with existing capped drawdown arrangements and for transfers in of existing capped drawdown arrangements. If clients require more income than the annual GAD limits allow (which can be viewed via our online client reports), then they can convert their arrangement to flexi-access drawdown on request with no additional cost.

Pension Commencement Lump Sums (or PCLS) can be taken on a one-off basis, or on a regular basis, using our new automated phased drawdown functionality.  Regular payments can be set up on a monthly, quarterly, half-yearly or annual basis to suit your clients’ needs.  These payments can be set up with, or without an accompanying taxable income paid on the same day, allowing you to tailor tax efficient income to suit your client’s individual requirements.  

This functionality is all online, and although we require no client signatures, you do have the facility to download documentation, where client signatures can be captured, if they are required for your own record keeping purposes.

In addition, clients also have the option of taking uncrystallised funds pension lump sums (or UFPLS) from their pension savings account.  Whichever route is chosen, records of the lifetime allowance used will be available on the client screens on our website, or via the pension summary report, to assist you with your ongoing client management.

Finally, on decumulation options, clients can also take advantage of the rules relating to small pension pots, assuming they meet the criteria defined by pension legislation.

How easy is it to pass on a pension pot following a client’s death?

The pension freedoms introduced in 2015, not only mean there’s more flexibility in how a client decumulates – but the change in legislation also means that clients now have more options for passing on any remaining pension benefits to their loved ones as well. Our pension has therefore been designed, in terms of Beneficiary drawdown options and Expression of Wish, etc., to allow you and your client to discuss and create a tax efficient succession plan.

Do you offer support to advisers with technical queries?

We provide a wealth of technical information on pensions on our website. So, for instance, there are in-depth adviser and paraplanner guides on the Lifetime Allowance, pension death benefits, the State Pension or pensions and divorce. We also provide a number of guides designed for you to use with your clients to help explain some of the more technical areas of pension planning.

We regularly produce a number of videos on relevant pension subjects, as well as having a library of pension (and tax) exam-based videos for those looking to further their professional qualifications.

Finally, for the more “nuanced” areas of pension legislation we have recently introduced our Pension Forum, where questions can be submitted on an anonymous basis

All this information (and more) can be found within the Technical Matters area of our website.

Where can advisers find more information on the pension?

If you would like more information on our award-winning pension, there’s a dedicated due diligence guide on our website as well as lots of other helpful materials. Alternatively, simply speak with your Fidelity Adviser Solutions representative or email us with a brief explanation of your enquiry and we will be in touch as soon as we can.

• Our pension guide ‘Helping your clients retire from work, not from life’
• Supporting you in your due diligence process
• Product specification
• Product summary
• Pension Summary report user guide
• Expression of Wish and Nomination guide
• Expression of Wish and Nomination form

•           Doing business with Fidelity through an adviser or intermediary
• Fidelity Client Terms for investors with an adviser or intermediary
• Client guide to our Pension – Helping you grow your retirement income