Hymans Robertson: 20-40 years lacking pension save

12 February 2015 Consultancy.uk

With the current state of pension savings, 41% of 20-40 years old will have insufficient funds to meet basic standards of income by their retirement, recent research from Hymans Robertson shows. According to the firm, older generations should encourage younger generations to “get into the savings habit early” to prevent them from lacking funds to meet minimum level of pension income.

In its analysis, pensions, benefits and risk consulting firm Hymans Robertson looked at the contribution level made by those between 20 and 40 years old, working for blue chip companies, into their pension pots. From its data, it became clear that 41% of those enrolled are currently not saving sufficiently for them to meet the minimum level of pension income. The research identified the rate required to meet minimum needs to be 15% of total income, however, the average employee in the 41% category is only saving 6%.

While the current system of auto-enrolment in pension schemes appears to be working, with 90% using the scheme and only 10% opting out, the auto-enrolment savings level of 8% is well below the minimum required according to analysis by the Pension Commission. With employees seemingly reluctant to engage with their future financial stability and make changes to be above the auto-enrolment level, the firm notes that it is wait and see if a more favourable rate is introduced in 2017, when the auto-enrolment rate is expected to be changed.

Pensions savings, Hymans Robertson

There are further potentially favourable changes expected within the tax code around pension schemes effective in April. It will be possible for those 55 and over to draw on their retirement savings, with the first 25% tax free. These changes, Hymans Robertson notes, may change the incentive to pay into pension pots at a higher rate for young people, as a means of saving with limited tax liability. This is especially true if there is a £ for £ employer matching scheme, which allows for employees to draw the matched income as 100% tax efficient long term saving.

While saving for pensions is inherently important for the long term financial outlook of person, the consultancy notes situations in which paying off debt or parking money in an ISA savings account is more practical. With high interest rate debt, particularly payday loans, a more rational move than saving is to pay it off as quickly as possible. If flexibility or access to finances is important, placing £15,000 (the tax free limit) in an ISA account leaves it outside the hands of the HMRC, but ready to hand.

Concluding, Paul Waters, Partner at Hymans Robertson, says: “It’s important that older generations encourage their younger family members to get into the savings habit early, helping them set up savings accounts such as pensions or ISAs as soon as possible. Employer facilitated savings vehicles such as DC pensions are typically the most effective starting point and should be used to their full advantage.”


RSM sells controversial UK wealth manager out of administration

26 March 2019 Consultancy.uk

RSM has overseen the sale of UK financial advisory firm Mount Sterling Wealth out of administration. The company had fallen into insolvency earlier in March, but has been purchased by Quilter Private Client Advisers for an undisclosed fee.

Mount Sterling Wealth is a York-based financial advisory firm, offering financial planning and wealth management services to clients from offices in Mayfair and North Yorkshire. Founded in 2010, the firm has endured an acrimonious relationship with the UK’s businesses community, having been formed by Scott Robinson to move his clients from an old firm, after being sued for advising on investments which failed and were not covered by professional indemnity insurance.

Robinson was allowed to continue working as a financial adviser by the Financial Conduct Authority (FCA), despite being ruled against in court and avoiding further legal action after liquidating his company. The controversial decision of the regulator caused Conservative MP Kevin Hollinrake to state the FCA needed "to take a long, hard look at itself" for allowing Robinson to continue trading.

RSM sells controversial UK wealth manager out of administration

That comment was prompted by the case of Hollinkrake’s Thirsk and Malton constituent, Andy Mohun-Smith, who according to the Yorkshire Post, lost £2 million after trusting Robinson (one of Mount Sterling Wealth’s two Directors alongside David McLaughlin). Mohun-Smith also claimed the saga had a “devastating” impact on his life and health, with the stress involved “undoubtedly a major factor” in the break-up of his marriage.

As a result of the chequered history of one of its Directors, there was little sympathy expressed for Robinson’s firm when it fell into administration in March 2019. Mount Sterling Wealth was placed into administration following historic financing issues, appointing Jamie Miller and Gareth Harris of RSM as joint administrators to oversee the sale of its assets. The York-based firm had around £100 million in assets under administration.

Mount Sterling Wealth has since been sold out of administration, in a deal that preserves both jobs and the continuity of service for its clients. The financial planning and wealth management practice was sold to Quilter Private Client Advisers for an undisclosed fee.

Jamie Miller, RSM restructuring advisory partner and joint administrator, said: "I’m pleased to confirm that the deal preserves all jobs, ensures continuity of service for the company’s large portfolio of private clients and business owners and should result in significant returns for both secured and unsecured creditors which is an excellent result in the circumstances."

Commenting on the acquisition, Dominic Rose, Strategy and Acquisitions Director at Quilter PCA, said, “Mount Sterling Wealth was placed into administration following some historic financing issues. RSM was appointed joint administrators and the business was then sold to Quilter Private Client Advisers. Mount Sterling Wealth’s portfolio of clients will now be serviced by Quilter PCA’s by London, Chester and Shipley offices ensuring continuity of service. In addition, one adviser will join Quilter PCA.”