With so many options out there to invest in, you may ask yourself, “Why should I invest in my pension? What value does it have for me or my loved ones? How can it benefit me in the long term? And how can I access money if I need some?”

Over the last few months, I have spoken with over 400 people, both blue collar and white collar, some of the markets’ newest investors, as well as some of the most affluent investors in our community. We discussed their concerns, the many challenges that they have with the markets and alternative investment choices like cash, gold, crypto, altcoins and skilled strategies like day trading, options trading, swing trading and others.

At the core, all of their questions boil down to, ‘”How do I live, work, save and invest for retirement, in the most expensive country in the world; and then manage these assets throughout retirement?

I recall a conversation I had with a friend, whose statement went something like, “Why would I invest in a pension when it won’t be enough left for me when I retire. I can probably do it better investing on my own; I’ll wait and invest when the markets are doing better!”  My friend’s statement reminded me of a quote from one of my favorite artists, “Forgot to fill up, on the road to riches? Too overly ambitious, too late to fix it, and too late for condolences when it’s all over” – Drake.  

We must never forget that in our pursuit to achieve great things, the accumulation of wealth, great or small, must always be supported by sound loss management, consistency, and longevity. 

In some instances, it’s true that more active and sophisticated strategies have their place. However, my friend’s statement underpinned a fundamental misunderstanding of defined contribution pension plans and their use as a financial vehicle. See, we are often restricted by key elements like information, time, liquid resources, and financial discipline. Too often our personal lifestyle choices do not support the generation of large sustainable returns for very far into the future. This is where assistance from a knowledgeable, financially apt, Pensions Advisor will help to ensure you are in the best position to endure retirement. 

Imagine the benefits of having a disciplined, Personal Retirement Plan, set up through your employer or established responsibly on your own. Your source of funds each contribution period is automated from what is typically your most reliable source of income – your paycheck. Those dollars are then used to purchase a diversified selection of mutual funds, which are an asset that you will accumulate throughout your working lifetime.

Thus, no doubt it makes sense to work with the best! In doing so, you too can enjoy the benefits of working with a team that is local and easily accessible; maintains only the highest quality investments; provides funds that are valued daily and daily traded. Plus, the added benefit of lower fees with no hidden costs equals more retirement savings for you!

For many of us, we often see friends or family members who have worked for the better part of 30 maybe 40 years, and are unable to sustain their retirement comfortably, let alone enjoy a retirement that they can be proud of. 

Afterall, you deserve to travel, to explore the world, to embrace your riches and reap your well-earned bounty. It is your life, your time, and your money. Perhaps, you’ll simply pay down some pesky bills or personal debts. Or maybe you strive to provide a leg up for your children and/or your loved ones. And certainly yes, you may even spoil the grandkids just a tiny bit too much. But on the back side of it all, you’ll live a long life of service and contribution in which you can continue to share your wisdom and knowledge for years into the future.

In the year 2000, The Government of Bermuda enacted The Occupational Pensions Act which provided the framework and governance for Pensions in Bermuda. It sets the guidance for employers and employees, such that once you have completed the equivalent of 3 months (or 720 hours) of service with an employer and are at least 23 years of age, you are eligible to participate in a 10% locked-in pension contribution scheme, (5% from the employee and 5% from the employer), with a one-year vesting period, that is made payable through your Employer Sponsored Private Pension Plan. The funds are typically Locked-in, earmarked for retirement. 

But did you know that there are various contribution types that are unlocked? Unlocked funds can often be redeemed by check, direct debit to your checking or savings account, or wired to you almost anywhere in the world, and usually involves a modest flat fee. One should budget for about 5-7 business days to complete processing. 

The most common type of unlocked funds is Additional Voluntary Contributions. Another example would be an employer that opts for a supplemental savings program. A possible third source of unlocked funds could come from any pension contributions made before the year 2000.  With a little help from your Pension Advisor, these unlocked funds can be made available to you when you need it most.

Understanding the Locked-in and Unlocked nature of your pension contributions can be pivotal in the way you think about and utilize your group pension or personal retirement plan. One may suggest that, in many ways, the private pension as a product, provides protection to us, from ourselves. It ensures that funds are available for us throughout our retirement. As an extra benefit, a sound personal retirement plan can provide us with peace of mind while we live our best life!

For personalized advice on how to achieve exactly what you want by investing in your pension, or for information on establishing a group pension plan, email rbinns@fmgroup.bm or call directly on (441) 294-4660 or (441) 538-1245.