Because they will be pan-European, PEPPs are likely to be portable from country to country and will deliver standardised features across the board, regardless of the location in which they were sold. It is also thought they will include flexibility for savers, allowing them to switch providers with relative ease.
Bulgaria currently holds the European Council presidency and the country’s minister for finance, Vladislav Goranov, recently told press that PEPPs will “promote competition amongst pension providers, enabling them to sell pension products outside their national markets and giving savers more choice over how and where to place their savings.”
Draft regulation documents suggest that after a minimum period of five years from the end of the contract savers would be able to switch providers (or five years from the most recent provider switch). Some providers may even allow such changes more frequently and fees for provider changes would be capped.
However, in order to become an expat pensions reality, the regulations must first be approved by European Parliament.
Watch this space.
This communication is for informational purposes only and is not intended to constitute, and should not be construed as, investment advice, investment recommendations or investment research. You should seek advice from a professional adviser before embarking on any financial planning activity. Whilst every effort has been made to ensure the information contained in this communication is correct, we are not responsible for any errors or omissions.
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Lehman Brothers filed for bankruptcy on 15 September 2008. With $639 billion in assets and $619 billion in debt. Their bankruptcy filing was the largest in history and prompted an immediate fall in the FTSE 100 of 4%. It was the beginning of a slump that by Christmas of 2008 had resulted in 23% being wiped off the value of Britain’s top 100 companies. As a stock market crash, it ranks alongside the dotcom bubble and the shock of 1987. However, while living standards have flat-lined since that date, the stock market revival has been spectacular. Many investors were, however, spooked by the financial crisis of 2008 and liquidated their investment portfolios. Unfortunately as shown below – they lost out on the bull run of the next 10 years.