Combine the power of property and pensions
For many people, the choice when planning for the future is either property or pension. Everyone needs a nest egg and opinion is divided over which is best, bricks and mortar or a pension scheme that gives you a good and safe return on investment. However, there is no rule that says you can’t do both at the same time. In fact, combining the power of property and a pension can be a great way to prepare for your later years.
The vehicle you need to deliver this for you is a SSAS. This stands for a small self-administered pension scheme. A SSAS is a fully tax-registered pension scheme that is overseen by a professional administrator alongside a directly authorised IFA who between them report directly to HMRC and the Pensions Regulator. SSASs have actually been around for years, so they are nothing new, but people are only just beginning to cotton on to their worth and potential. The major benefit of a SSAS is that it puts you in control of your funds and your investment strategy.
Not all SSASs are the same and some have been created for specific circumstances. For example, some SSASs have been designed specifically by property investors for property investors. The SSAS structure we use is a prime example of this. It was approved by HMRC back in 2014 and it still offers investment opportunities and growth that are not available from traditional SSAS schemes.
With the SSAS scheme we use, up to 50% of the pension fund can be made available through HMRC approved routes such as a special purpose vehicle. These funds can then be used to help you grow your property portfolio. Because it is a pension, you can continue to make personal or business contributions, take a tax-free cash lump sum or draw income. In short, it’s no different from any other pension apart from the things it can be used to invest in and who controls the investment strategy.
If you’re thinking about taking control of your existing personal pension or frozen employment pension and want the flexibility to develop your own investment strategy to grow your fund, a SSAS pension scheme could give you that opportunity. Whether you are looking to purchase land or property, invest in a business through loans or enjoy the benefits of fixed returns in a completely hands-off property investment, the SSAS could be a great choice to help you achieve these goals and provide you with the retirement you want.
Agile Property Partners are not financial advisors and therefore are not qualified to provide personal investment advice. We act as introducers to scheme providers who will direct you to qualified financial advisors as part of the process. You may also wish to seek your own independent financial advice.