1 / 48

Noel Hackett - QFA Senior Pension Consultant Tony Delaney – Area Manager , New Ireland

New Ireland Assurance Provider of choice in the Life and Pensions Market YOUR PENSION & RETIREMENT PLANNING PRESENTATION. Presenters:. Noel Hackett - QFA Senior Pension Consultant Tony Delaney – Area Manager , New Ireland. Thurs/ Friday 15 th -16 th May 2014.

sahara
Download Presentation

Noel Hackett - QFA Senior Pension Consultant Tony Delaney – Area Manager , New Ireland

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. New Ireland Assurance Provider of choice in the Life and Pensions Market YOUR PENSION & RETIREMENT PLANNING PRESENTATION. Presenters: Noel Hackett - QFA Senior Pension Consultant Tony Delaney – Area Manager , New Ireland Thurs/ Friday 15th -16th May 2014

  2. About New Ireland Assurance • New Ireland is a leading Life Assurance Company in Ireland • Provides life assurance, pensions & investment solutions to over 500,000 customers • Established almost 100 years ago, New Ireland was the first wholly Irish owned company to transact business in Ireland • New Ireland remains Irish owned to this day as part of the Bank of Ireland Group

  3. The Company has gone from strength to strength, from just £1,000 in assets in 1918 to over €13.4 billion today (Feb 2014) • New Ireland employs over 1,100 people with the main Head Office on Dawson Street for over 85 years • Have world class investment partners for our existing single manager portfolios including State Street Global Advisors Ireland, Bank of New York Mellon Asset Management and Kleinwort Benson Investors

  4. Agenda • Your Main NUI Galway Pension Schemes • The Finance Act 2014 and changes that may affect you • Investment Market Update and Investment Outlook for 2014 • Fund Choice, Fund Manager, Fund Performance and Fund availability under your AVC Scheme

  5. Benefits at Retirement At retirement your benefits will come from:- • State Pension ( PRSI Contributions) • NUIG Scheme (s) • Purchase of Notional Years • Additional Voluntary Contributions ( AVCs ) • Personal Accumulated wealth/savings inheritances

  6. NUIG Pension Scheme • Defined Benefit Scheme • Scheme provides • Pension • Lump Sum ( Gratuity ) • Spouses Pension • Increases during course of payment • Death in Service Benefit • Actual benefits depend on when you joined • Please refer to your NUIG Annual Benefit Statement. • ( Individual Consultations with Noel Hackett)

  7. Key Dates • Pre 95 – no state pension, higher pension through NUIG • Post 95 - employees pay PRSI and receive: • State Pension • Lower pension from NUIG • 2004 • Future employees have minimum RA of 65 • Immediate early retirement pension available to: • Existing employees from 50 • New employees from 55 • 2013- Career Average Earnings

  8. State Pension • From 2014 • Single Person: €230.30 per week • Married Couple: €383.80 • Applies to all employees who joined since 1995 • State Pension 2014 from age 66 2021 from age 67 2028 from age 68 (Social Welfare will pay Job Assist or other S/W payment- where for whatever reason S/W payment not allowed, a Supplementary Pension maybe paid by NUIG )

  9. Early Retirement Was always allowed but only as a deferred pension Changes from 2004 • Existing employees from 50 • New entrants from 55 • Immediate pension payable • Early payment reduction

  10. Bridging the Gap - 2 Options Purchase of Notional Years of Service Through NUI Galway Pensions Office AVC Scheme Through New Ireland Assurance

  11. Notional Years • Employee can buy “notional years” • Defined Benefit basis • Must buy year with all the “trimmings” • Pension • Gratuity • Spouses Pension • Pension Increases

  12. AVC Scheme • Tax Relief • Tax free growth • Fund Choice • Flexibility • Options at retirement • Inheritance Tax Planning

  13. Employee Tax Relief Limits (including AVCs) Age% of Remuneration Up to 30 15% 30 - 39 20% 40 - 49 25% 50 - 54 30% 55 - 59 35% 60 + 40% • An earnings cap of €115,000 (2014 apply to Employee Pension Contributions for the purpose of tax relief • The above limits include contributions to NUIG Pension Scheme

  14. Making it easy to track your Fund Pensions Schemes Online • Password protected website • Information on • premium history • fund value • Estimated fund at retirement • It is free and easy to use • Review yearly – especially if circumstances change

  15. 2014 Finance Act- Main changes • Pension Levy • Standard Fund Personal Threshold • Defined Benefit Changes • DIRT Tax 41% plus 4% PRSI • Inheritance Tax Threshold • Gift Tax • Age Exemption Limit @ Retirement

  16. Market and Investment Update • Fund Performance • Equities • Bonds • Capital Guarantees • Property Funds • Risk Managed Funds • ESMA Risk Ratings 1-7

  17. “Would you tell me, please, which way I ought to go from here?” “That depends a good deal on where you want to get to”, said the cat - Lewis Carroll, Alice in Wonderland

  18. Lets begin by reminding ourselves of the cornerstone questions of any investment decision….. Objectives: What do you want to achieve? Timeframe: How long do you have to achieve it? Risk Profile: How much risk can/will you take to achieve it? Every aspect of investment advice should revolve around always being aware of your views on each of the three key points above!

  19. The events of 2008 still fresh in our memories! • Sept. 8thFannie Mae & Freddie Mac under government control. • Sept. 14thLehman's files for bankruptcy • Sept 15thBank of America purchases Merrill Lynch • Sept 16th Fed takes 80% stake in AIG for $85bn • Sept 18thLloyds TSB takes over of HBOS • Central Banks globally pump $180bn of liquidity into the market • Marketban on short selling • Sept 19th Paulson announces ‘Troubled Asset Relief Program’ – markets soar • Sept 21stGoldman's Sachs & Morgan Stanley become Bank holding companies • Sept 26th Overnight collapse of Washington Mutual in the biggest US bank failure ever. • Sept 29th Announcement that Bradford & Bingley and Fortis are being nationalised. • Citigroup agrees to buy Wachovia's banking business. • Sept 30th News that Irish government will guarantee all deposits and debt of main credit • institutions for 2 years • US Lawmakers vote against proposed treasury rescue package And then came October!!

  20. 1st week in October 08: As bad a week in markets as we’d seen in decades!

  21. This left many Investors very nervous about their future finances, long after the market began to recover! Is it safe to Come back out? “Both optimists and pessimists contribute to society, the optimist invents the airplane, the pessimist the parachute”….George Bernard Shaw

  22. 1926 to 2013 annualised returns of the Standard and Poors equity index. S&P 500 Index - Total Returns Year Year Year Year Year 1926 11.62 1945 36.44 1964 16.48 1983 22.51 2003 28.68 1927 37.49 1946 -8.07 1965 12.45 1984 6.27 2004 10.88 1928 43.61 1947 5.71 1966 -10.06 1985 32.16 2005 4.91 1929 -8.42 1948 5.50 1967 23.98 1986 18.47 2006 15.80 1930 -24.90 1949 18.79 1968 11.06 1987 5.23 2007 5.49 1931 -43.34 1950 31.71 1969 -8.50 1988 16.81 2008 -36.99 1932 -8.19 1951 24.02 1970 4.01 1989 31.49 2009 26.46 1933 53.99 1952 18.37 1971 14.31 1990 -3.17 2010 15.06 1934 -1.44 1953 -0.99 1972 18.98 1991 30.55 2011 2.11 1935 47.67 1954 52.62 1973 -14.66 1992 7.67 2012 16.00 1936 33.92 1955 31.56 1974 -26.47 1993 9.99 2013 31.90 1937 -35.03 1956 6.56 1975 37.20 1994 1.31 1938 31.12 1957 -10.78 1976 23.84 1995 37.43 1939 -0.41 1958 43.36 1977 -7.18 1996 23.07 1940 -9.78 1959 11.96 1978 6.56 1997 33.36 1941 -11.59 1960 0.47 1979 18.44 1998 28.58 1942 20.34 1961 26.89 1980 32.42 1999 21.04 1943 25.90 1962 -8.73 1981 -4.91 2000 -9.10 1944 19.75 1963 22.80 1982 21.41 2001 -11.88 2002 -22.09

  23. Cash funds offer little in terms of return….. 2011 > 5% 2012 > 4% 2013 .5% 2014 .25%

  24. Inflation may well be an issue in the near future. Challenge!

  25. But we still only have a finite number of assets in which to invest! Equities Equities Property Deposits Property Alternatives Bonds

  26. Avoidingsignificant losses should be the starting point for every successful investor! LossRequired Gain 20% 25% 40% 66% 60% 150% Minimisinglosses and reducing investment risk has become more and more important to investors after the great financial crisis of 2008.

  27. The power of stable returns The key learning from recent past…the power of stable returns. A +20% +20% -10% +29.6% B +35% -10% +5% +27.6% C +10% +10% +10% +33.1% “I have two basic rules to investment, Rule no1: Never lose money. Rule no 2: Never forget rule no 1”!! …… Warren Buffett Source: Newton

  28. A complex market…which can be difficult to navigate Derivatives for Protection Tactical Asset Allocation Customer Questionnaires Property? Portfolio Construction ESMA? Total Return Strategies ¯ Protected Funds ¯ Manager Diversification Market Neutral Strategies Rebalancing? Regulation & Compliance

  29. Performance Figures & Fund Choice • FUND past 12months 3yrs pa 5yrs pa • Cash Fund(1) 0.2% 0.5% 0.7% • Gilt Fund (4) 2.5% 7.0% 5.2% • BNY Mellon(4) 4.4% 4.6% n/a • Elements (3) 4.5% 4.4% n/a • Protected Assets (4) 6.6% 3.4% n/a • Managed (5) 11.7% 10.5% 14.0% • Consensus(5) 9.9% 10.0% 14.0% • Ethical (5) 11.0% 10.2% 14.1% • Evergreen (5) 10.5% 8.6% 11.2% • Equity Fund(6) 14.1% 11.8% 17.6% • Innovator (6) -0.3% 2.0% 11.0% • Funds are updated each day. • ESMA Risk rating 1 to 7 scale.

  30. SSgA — A True Global Player €1.7 Trillion in Asset Under Management1 Over 400 investment professionals 27 Global Offices; 9 Investment Centres 24 Hour Trading Rankings: # 1 Global Endowment/Foundation Assets2 # 1 Sovereign Wealth Fund Assets2 # 2 Worldwide Institutional Assets2 Key Stats: We Manage Money for 9 of the Top 10 S&P 500 Companies3 We Manage Money for 6 of the Top 20 Wealthiest Countries in the World 3 1 AUM is $2.15 Trillion. This AUM includes the assets of the SPDR Gold Trust (approx. $37.1 as of 30 September 2013). for which State Street Global Markets, LLC, an affiliate of State Street Global Advisors, serves as the marketing agent. Please note that AUM totals are unaudited. 2 Pensions & Investments, 31 December 2012. 3 Source: SSgA, as of 31 December 2013. S&P 500 top 10 by market capitalization as of 31 December 2013. Source: SSgA. Top 20 Wealthiest countries by GDP per Capita as of World Economic Outlook Database — October 2013. IREPRS-0681

  31. SSgA: Size isn’t Everything…. But it Helps! • Snap shot of how SSgA measure up against some local competitors Global AUM (€ Billion) Source: P&I/Towers Watson Global 500 year end 2012. IREPRS-0516

  32. A Different Approach… Lifestyling – Moving to safer assets as you get older Passive approach… Active IRIS approach… Absolute Return Bonds / Cash Equities Source: SSgA. This chart is for illustrative purposes only. IREPRS-0740

  33. Target Return to Help Absorb Shocks Equities Early Years Growth phase Retirement Goal Equities + Absolute Return Fund Source: SSgA. This chart is for illustrative purposes only.

  34. Active IRIS Glide Path

  35. Target Return Strategy

  36. Target Return Strategy Helps Manage Risk

  37. Target Return Strategy Helps Manage Risk

  38. Passive IRIS Glide - Path Default Fund

  39. Passive Management Why SSgA for Passive? SSgA’s Trading Advantage Helps Deliver World Class Index Tracking • 24hr Trading — London, Boston & Hong Kong • 282 million¹ shares traded every day • 21.8%2 of shares matched between clients • 0.02%3 trading commission paid on market trades • = Low Cost and Efficient Trading 1 SSgA Global Trading Desk for year ending 2012. 2Boston Global Passive Equity Desk average, Q2 2013. 3 Average Commissions paid on traded, Boston Global Passive Equity Desk, Q1 2013. Source: SSgA, All World Developed Equity Index, MSCI World Net Dividends Re-invested. Past performance is not a guarantee of future results. The performance includes the reinvestment of dividends and other corporate earnings and is calculated in euro. The performance figures contained herein are provided on a gross of fees basis only, but net of administrative costs. The performance figures do not reflect the deduction of investment management or other fees which could reduce the return. Index returns are unmanaged and do not reflect the deduction of any fees or expenses. Index returns reflect all items of income, gain and loss and the reinvestment of dividends and other income. IREPRS-0740

  40. Passive IRIS – Global Equity (MSCI) Country Allocation Source: Country Allocations and top 10 Holdings: ssga.com as at 31.03.2014 40

  41. Passive IRIS – Government Bonds Country Allocation 41 Source: Country Allocations Are the neutral benchmark weights for both funds. The Key Stats are provided by SSgA as at 31.03.2014 and are based on the underlying SSgA funds.

  42. Passive IRIS – Corporate Bonds 42 Source: Country Allocations and Key Stats are taken from SSgA.com as at 31.03.2014 and are based on the underlying SSgA fund “SSgA Euro Corporate Bond Index Fund”.

  43. Passive IRIS – Property Source: SSgA. All data is at 31 March 2014 unless otherwise stated subject to change, and should not be relied upon as current thereafter. The weights above are exclusive of cash holdings. *As at 30 June 2013. **This is calculated on the basis of contracted rent divided by capital value of direct property holdings and does not take into account any of the costs associated with the fund or property acquisition costs. 43

  44. Passive IRIS – Cash • Primarily invested in AAA Rated SSgA Liquidity Fund • Over 75 different Cash Instruments held with over 40 different large Financial Institutions • Weighted Average Maturity of Cash Instruments is 38 Days • Primary Focus is on Safety and Liquidity Source: Stats taken from SSgA.com as at 31.03.2014 – SSgA EUR Liquidity Fund 44

  45. So lets finish by looking at the correct investment process. 1. Your Goals objectives 5. Regular Review 2. Your Risk Profile 4. Investment Fund choice 3. Asset Allocation

  46. Pensions Office NUI Galway Ph: (091) 495028 ext: 5028 Email: pensions@nuigalway.ie or Noel Hackett, QFA,Pensions Consultant New Ireland Assurance Tel: (061) 312166 Mobile: 086- 8186163 Email: Noel.hackett@newireland.ie What Should I Do Next? Contact:

  47. Any Questions? Thank You for attending

  48. Individual Consultations Available Noel Hackettwill be available (9 – 5pm) for Confidential Individual Consultations Concourse Room AC 201 (near Smokeys ) Monday 19th Tuesday 20th & Wed 21st May 2014 Contact: Ann Cormican or Caroline Mooney Extn 5901/5028 ann.cormican@nuigalway.ie Caroline.mooney@nuigalway.ie

More Related