Column: Simmons-Wade On Seniors & More
[Opinion column written by PLP MP Ianthia Simmons-Wade]
As Bermuda’s population ages and life expectancy increases, securing a stable financial future becomes increasingly important for our seniors and those approaching retirement. The government’s recent announcement regarding private pension plans marks significant progress towards our vision of a better, fairer Bermuda by safeguarding the retirement savings of our people. These changes will directly benefit not only those nearing retirement but also their families, who often bear the responsibility of supporting them.
Starting in April 2025, Bermudians will see a reduction in the administration fees charged on private pensions, along with new limits to ensure these fees remain reasonable in the future. This initiative, resulting from the collaborative efforts of your PLP Government, the Pension Commission, and local pension administrators, is designed to protect every dollar you’ve worked hard to set aside for your golden years.
Currently, pension plan administrators can charge fees without any limits, sometimes as high as 4.2%. This can significantly reduce the amount you have at retirement. The new regulations will cap these fees based on your pension balance, ensuring that more of your money stays in your account, growing for your future needs.
For those in defined contribution employer pension plans or group retirement plans, the fees will be capped as follows:
- 1.25% per year for balances over $50,000
- 0.75% per year for balances between $25,000 and $50,000
- 0.5% per year for balances under $25,000
For those with individual local retirement plans, the fee structure is:
- 1% per year for balances over $50,000
- 0.75% per year for balances between $25,000 and $50,000
- 0.5% per year for balances under $25,000
These caps are expected to result in significant savings. For example, someone with a balance over $50,000 could save an average of $725 annually, potentially adding over $75,000 to their retirement fund over a 40-year career.
Additionally, the government is mandating that pension plans offer lower-cost investment options, such as index funds, and will prohibit administrators from receiving advisory fees on these investments. This ensures that your money works harder for you, maximizing your returns and contributing to a more secure retirement.
The Government has made these changes because we believe in protecting the quality of life and dignity of our seniors whenever we can. We began with ensuring that seniors’ pensions increase every year, and this is another step towards securing a brighter future for every Bermudian in their golden years.
- MP Ianthia Simmons-Wade, Constituency 25 – Warwick North East
This coming from the PLP where the government pension fund has been drying up. What is the current shortfall and what steps have you taken to address that?
My wife and I are both seniors we are relying of the pension income whic is valued at 10% less to fight inflation.
Guess what your turn is coming. !
I had no idea, till now that our pension money was being depleted by service charges on a percentage basis
so it cost more money to service large contributions.
They think that they are doing us a favour we are doing them a favour.
large penson contributions cost more to manage, oh ! Realy .
Pull the other leg its got bells on it!
This is un real so they keep sucking on the straw till all the money runs out.
How Wonderfull is that ?
I am conserned if any of the pension money held in trust is used ?
or is it invested which i have reason by the increase delay which doubt .
If so they may tell you , and again if so where and how, may be it goes from pillar to post.
We are told the there will be no pension pay out till September /24 so what do we do for food. Go fishing !
Are they waiting for aditional contributions to fill the balance sheet ,it certainly looks that way.
If you are employee you pay income tax it the Peter pay Paul principal.
There is another name for that .
When it come to taxes we the pentioners are still paying taxes all that comes from our pension income which they hold in trust.
Some of us do not have to pay out on land tax its a sucker fund and only a portion on the family car license that looks like the system is a set up ,as taxation is from the cradle to the grave and where the money goes no body knows and no body is telling.
May i ask where is the annual tax balance sheet, is it a blank piece of paper?
We get more from the weather channel !
There are also more questions than answers here!
They tell us that the pension fund is under funded.
They never tell us by how much.
That is unbelievable .
So what is the opposition doing, nothing ! oh sorry ! They get pension for life.
The people of this island don’t seem to know how powerfull their vote realy is.
When you arrive at the ripe old age of 65 you can say you have been paying taxes for more years than you have years remaining it seems that they are more conserned about parking tickets.