5 Reasons to recommend ITC

Independent Trustee Company are delighted to announce that we have been shortlisted for 5 Irish Pension Awards. The awards which will take place on 21st November 2012 aim to give recognition to pension funds and providers who have proved their excellence, professionalism and dedication to maintaining high standards of Irish pension provision. The categories that we have been shortlisted for can be seen below.

You can find out more information on the awards here.

Generation Y Not

Retirement is too far off and I prefer to enjoy my money now. Sound like what you would expect to hear from a twenty something today? Well it’s not far off! In a recent survey commissioned by ITC, retirement being too far off was found to be the main factor for the reluctance to invest in a pension amongst Generation Y.

Described as the ‘here and now’ generation, it seems that Generation Y view retirement planning as somewhat of an afterthought. In a time when staying with your current employer for longer than three years seems like a lifetime, joining a company pension plan is probably not a top priority for most. But how sustainable is this and what does it mean for the future of this generation? Do they hope to rely on the state pension, currently valued at €12,000 per annum or have they even thought about it? Growing up in an era of prosperity yet arriving at a destination of economic turmoil, are many simply avoiding their financial responsibilities?

Is the issue the challenge of engagement or has the industry simply not tried? Generation Y are seen as the hardest generation to reach, not surprising given the media rich environment that they have grown up in. As an industry, is it our duty to highlight the issue in a way that will force this young population to stand up and pay attention? By 2025 Generation Y will make up 75% of the world’s workforce. This is a scary statistic when you fast forward to retirement time.

Are the consequences of enjoying money now to be realised too late for Generation Y? Not if we adapt our strategies to suit their needs. An on the go generation that demand convenience and accessibility, a pension plan to suit Generations Y’s lifestyle is lacking within the marketplace. But what would the ideal pension product for this demographic look like? It must start with ease of access, the option of early drawdown and bundled solutions that will allow for planning opportunities. We are in need of a product that will work in harmony with the lifestyle choices of the individual.

The dramatic change in how consumers of this generation engage with products demands that we adapt our strategies in order to stay relevant. The product has to be right but indeed so does the message. Pensions need to be marketed in a way that is relatable; relating the cost back to real life terms and demonstrating the consequences of not making retirement provisions.

There is an exciting opportunity here if it is executed in the right way.

Melanie Farrell

Independent Trustee Company

Dáil Drawdown - NPRF

In this installment of Dáil Drawdown, Deputy Michael McGrath asks the Minister for Finance for more information on the National Pensions Reserve Fund.

Source:www.oireachtas.ie

Dáil Drawdown - Drawdown of Pension Funds

Source: www.oireachtas.ie

A third of workers plan to rely solely on a state pension

In a recent survey conducted by Amarach Research, it was found that a third of workers plan to rely solely on a state pension, the Irish Independent reported today.

The state pension currently stands at just under €12,000 per annum which is about one third of the average wage (€35,849, CSO 2011). These figures mean that many people will find it almost impossible to keep up their current standard of living if they rely solely on the state. In a recent report by the IAPF it was found that there was a large gap between what people expect from the state pension and what they will receive in reality. This gap is likely to get wider.

The survey, conducted with 1,000 adults shows that only 4 out of 10 people plan to use a combination of the state pension and private retirement income. It was also found that three-quarters of people do not know how much they are paying in annual pension charges and just one in 10 shop around for pension products (Independent.ie).

The importance of private pension provision is unquestionable, relying solely on the state pension will not ensure long term financial security for most.

You can read the full article here.


Melanie Farrell
Independent Trustee Company

A diamond is forever, but what about your pension?

Any employers who are currently acting as trustee on their group pension scheme and are querying the value of appointing an independent trustee may be interested in reading the article by Tim Healy in the Independent - Ex- De Beers pension fund members are owed €50m, court hears.

This case outlines very clearly the inherent conflict of the employer trustee, particularly in a wind up situation. One of the main duties of a trustee is to act in the members best interest. It can be very difficult for a member trustee, who is employed by the company, or a company trustee who has an allegiance to the employer to separate out these roles and only act with only the members interest in mind. As can be seen in this case to do otherwise can leave the trustees open to legal action by the members. The members claim in this case is thought to be valued at €40-50 million. By appointing an independent trustee you can avoid this potential conflict.

Niamh Quirke

Technical Associate

Independent Trustee Limited