Certus Pensions


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The Certus Defined Contribution Pension Scheme has advised that Certus, the sponsoring employer of the scheme, has announced that it is to close with effect from 30th July 2016, giving you less than 2 weeks’ notice. See announcement in the Certus pension bulletin – INSIGHTS July 2016.

The closure of the scheme is one thing, but the section “What happens next?” is the really interesting part of the INSIGHTS newsletter. This section refers to the trustees exploring the options available to them “in terms of the continuation of, or the winding up of the scheme”, and then writing to members in August to outline the key decisions – swift action by the trustees!

It seems likely that with Certus out of the picture and no longer funding the running costs, the trustees will have to wind up the scheme.

Can they do this?

Simply, yes they can, and members have no means to object to the closure proceeding.


What does this mean for you?

As an employee of Certus/Bank of Scotland Ireland you and your employer contributed a percentage of your gross salary to your pension savings scheme.

Many staff left their contributions in the scheme because they were unclear about what options are open to them, and with Certus paying the administration and management costs, it made some sense to leave the pension where it was.


Now, it’s all change

It is likely that the option of staying in the scheme is gone. You will either opt to move to an alternative pension arrangement of your choice, or, you will be automatically forced into a new pension scheme without your consent or agreement.

Option letters will be sent to all members in August, but you can act now to start to consider the pension plan that you would like to choose.


What should you do?

Firstly, find out the value of the pension fund that you have presently accumulated, this may rule-in or out certain options for you. If you are unclear about how to find out the value of your pension, contact us for further information.

Then, consider the various options that are open to you, which may include:

  1. Taking a refund of your pension contributions (only available prior to wind-up)
  2. Transferring your pension to a new pension scheme
  3. Transferring to a personal retirement bond
  4. Transferring to a PRSA
  5. Taking early retirement, or
  6. Cashing in the pension under trivial pension rules.

You can choose which of these options suit you best, subject to rules and restrictions and it is best to take advice from a pensions expert who can help you to decide which option is best for you.

The one option that is not available is to do nothing – because if you do not make a conscious choice, the trustees will and they will kick you into the default personal retirement bond option with an investment that you did not choose and charges that you did not agree to.


Consequences of this decision

The consequences of your decision in relation to your pension are profound and long lasting. The correct choice of pension for you will allow you to make the investment decisions that you want, giving you a flexible range of choices with security and growth potential options.

The main areas for decision relate to Choice of Investments, Choice of Benefits at retirement, Maximising Tax Free Lump sum options and the charging structures.

The information in this email is for information purposes only, it should not be taken in any way as financial advice and should not be relied upon for any decisions. In order to make an informed financial decision, we recommend that you meet with one of our financial advisors for a free review and recommendation which you may then follow or ignore.

IPS Financial Advice have 15 financial advisors across the country and can arrange a meeting with you at a time and place that best suits you.


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