NHS PENSION CHANGES Seminar - 28 th February 2012 Paul Stone Partner Medical Money Management Exeter Paul Stone Partner Medical Money Management Exeter

About MMM Independent Financial Advice since 1971 Over 70% of clients are HealthCare Professionals Nationwide coverage No ties, links or affiliation Totally independent Independent Financial Advice since 1971 Over 70% of clients are HealthCare Professionals Nationwide coverage No ties, links or affiliation Totally independent

About MMM Specialist knowledge of the NHS Pension Scheme Understanding Home & Business Financing for Medical Professionals Knowledge of Medical Career Path Working with clients from qualification to retirement Updates on Legislation and Tax Planning Retirement Planning Services Specialist knowledge of the NHS Pension Scheme Understanding Home & Business Financing for Medical Professionals Knowledge of Medical Career Path Working with clients from qualification to retirement Updates on Legislation and Tax Planning Retirement Planning Services 3

Hutton Report on Public Sector Pensions Nov 2011 – Chief Secretary to the Treasury NHS Pension Scheme - Heads of Agreement Increased Contributions for ALL Schemes Hutton Report on Public Sector Pensions Nov 2011 – Chief Secretary to the Treasury NHS Pension Scheme - Heads of Agreement Increased Contributions for ALL Schemes 4 The “NEW” NHS Pension Scheme

Career Average Revalued Earning Scheme (CARE) Retirement age linked to State Retirement Age & Life Expectancy (Range 65 to 68) Introduction Date – April 2015 Accrued Rights Protected (1995 & 2008 Section) CPI Revaluation = CPI + 1.5% No Automatic Lump Sum (Commutation 12 to 1) Must take both 1995 Section & New simultaneously Career Average Revalued Earning Scheme (CARE) Retirement age linked to State Retirement Age & Life Expectancy (Range 65 to 68) Introduction Date – April 2015 Accrued Rights Protected (1995 & 2008 Section) CPI Revaluation = CPI + 1.5% No Automatic Lump Sum (Commutation 12 to 1) Must take both 1995 Section & New simultaneously

The “NEW” NHS Pension Scheme TRANSITIONAL PROTECTION 10 years from 1 st April 2012 – NO CHANGE Between 10 & 13.5 years to 1 st April 2012 – Limited Protection >13.5 years to 1 st April 2012 – NO PROTECTION TRANSITIONAL PROTECTION 10 years from 1 st April 2012 – NO CHANGE Between 10 & 13.5 years to 1 st April 2012 – Limited Protection >13.5 years to 1 st April 2012 – NO PROTECTION

The “NEW” NHS Pension Scheme

The “NEW” NHS Pension Scheme 3.5 Years Tapering Protection Years to current NPA less 10 yearsDate of switch to new scheme 3.5 and over01/04/ /04/ /04/ /04/ /04/ /04/ /04/2021 0Protected

Lifetime Allowance (LTA) Fixed Protection & Benefit Accrual Loss of Fixed Protection – 90 Day Rule Increasing the PCLS (Lump Sum) Crystallising Benefits Non NHS Pension Plans (SIPP / FSAVC / PP) Review Personal Situation - 6 th April 2012 LTA Reduces To £1.5 m Fixed Protection & Benefit Accrual Loss of Fixed Protection – 90 Day Rule Increasing the PCLS (Lump Sum) Crystallising Benefits Non NHS Pension Plans (SIPP / FSAVC / PP) Review Personal Situation - 6 th April 2012 LTA Reduces To £1.5 m

Annual Allowance Reduced from £255,000 to £50,000 6 th April 2011 C/F Allowances - Current Year first Pension Input Periods – Management of Dates Reduced from £255,000 to £50,000 6 th April 2011 C/F Allowances - Current Year first Pension Input Periods – Management of Dates

Annual Allowance Calculation

Pension & Tax Changes - Other NEW - Flexible Drawdown from 6 th April 2011 No Requirement to Purchase Annuity 55% Tax Charge – Unsecured Income / Over Age 75 Personal Allowance Trap – 60% Effective Tax Rate Alternative Plans – e.g. ISA / EIS / VCT NEW - Flexible Drawdown from 6 th April 2011 No Requirement to Purchase Annuity 55% Tax Charge – Unsecured Income / Over Age 75 Personal Allowance Trap – 60% Effective Tax Rate Alternative Plans – e.g. ISA / EIS / VCT

Savings Objectives Short term Slush Fund Car Holidays Deposit for house Bank Accounts ISAs Flexible Mortgages Medium term Career break Children ISAs Flexible Mortgages Unit Trusts Structured Investments Long term Retirement Early Retirement Clear Mortgage Lifestyle NHS Pension Additional Pension ISAs Flexible Mortgages

You can invest with any number of companies Would you choose one of these Or would you spread it around? Would you spread your investments around?

Medical Money Management General Insurance David Williams & Miles Brown Surgery Insurance Locum Insurance Personal Insurance – House / Contents / Car Travel Insurance Personal Bespoke Service David Williams & Miles Brown Surgery Insurance Locum Insurance Personal Insurance – House / Contents / Car Travel Insurance Personal Bespoke Service

Questions Q&A Complete Enquiry Form THANK YOU Paul Stone - Q&A Complete Enquiry Form THANK YOU Paul Stone -

Medical Money Management is authorised and regulated by the Financial Services Authority. The content of this presentation is intended for general guidance only, and you should seek specific financial advice before taking action on any aspect of it. The risk profile of investment products varies and should be matched to your individual attitude to risk. The value of certain investment products can go down as well as up. Some funds may include investments that are not designated in sterling and the prices may alter purely as a result of exchange rate movements.