The tools will show clients where additional pension funding can make a big difference to their retirement income.
The new ‘Phase 2’ tools will be added to Prestwood’s cashflow planning system for planners from 16 July.
The company says the suite of tools is designed to make it easier for advisers to bring ‘live pension planning' to client meetings. The tools help clients see and understand the complexity of contributions.
Among the areas covered are:
- how much carry-forward is available?
- has my client triggered the Money Purchase Annual Allowance?
- can they make a larger contribution through their employer?
- would they be better off benefiting from tax relief now, and potentially having a Lifetime Allowance charge later on?
Prestwood says that ‘underfunded’ pensions are a “terrible reality for our society.”
Prestwood’s new Pension Contribution calculator is available from 16 July. Prestwood says the new tools will save planners considerable time trying to calculate underfunding issues.
Julie Lord, director of Prestwood and an experienced Financial Planner herself, said: “Just doing cashflow is not good enough any more. These comparison tools help to deal with the issue of underfunding pensions and show clients how much even a small increase in contributions can make to their retirement planning.
“Our customers told us they wanted new pension planning tools to do more complex calculations in front of the client at the touch of a button and save considerable time digging around for an answer.
“I really believe you need the right tools to do the job properly and just being able to produce a cashflow chart is not enough from the FCA’s perspective.”
Prestwood Software is part of The Prestwood Group which was founded by Paul Etheridge MBE, one of the UK’s longest serving Financial Planners and a founder of the Institute of Financial Planning, now part of the CISI.