Under new government proposals, self invested personal plan investors will have the freedom to move their ‘protected rights’ money to direct shares, bonds or commercial property if they so wish. The proposals are due to come into force in October next year.
Provisions laid out in the Pensions Act 2007, see ministers consulting the pension industry on freeing up protected-rights funds that have built up in contracted out personal pension schemes. People who contracted out via personal pensions are likely to be still working and the self-invested personal plan market is predicted to be around £20billion.
Our view
Protected Rights are the ‘contracted out of serps’ and now ‘contracted out of State Second Pension’ pension monies. They are are technically National Insurance contributions and the Government encouraged us all to contract out to our own private pension schemes and take responsibility for this part of our pension planning.
It is about time that they gave us the investment freedom that they allow for the rest of our pensions.
Useful links:
Learn more about this and related topics in the Pensions Adviser.com Channel
Request expert financial advice now
Purchase guidance on financial planning in the Money Shop