How ProfitShare could make a difference
For the last six years, we've boosted the pension savings of our eligible unit-linked pension customers between 0.15% and 0.18%. You could get more or less than this and there's no guarantee that we'll be able to award ProfitShare every year.
ProfitShare in practice
To give you an idea of the difference ProfitShare could make, let's introduce you to Harry.
Harry has just joined his employer's pension plan.
- He's aged 30
- He's decided to contribute £230 each month
- He'll transfer £25,000 from a previous pension into his employer's pension plan
- He wants to retire at age 65
Harry’s projected pension savings
The pension savings Harry's able to build up by age 65 depend on how his chosen investments grow each year as shown in the example below.
This figure isn't guaranteed and is just an example. Harry could get more or less than this.
We've assumed he'll increase his pension contributions in line with inflation each year and that he'll contribute until he retires at age 65. We've also assumed we'll apply a yearly management charge of 0.75% to all his pension savings.
We've assumed that inflation will reduce the buying power of Harry's pension savings by 2% each year. We've allowed for this by reducing the growth rate to 2.1%. This should give a more realistic view of what Harry could buy with his plan if his retirement income was payable today.
The impact of ProfitShare for Harry
Now let's look at the difference ProfitShare could make to Harry's pension savings, assuming we award 0.15% of the value of his plan each year and his investments grow by 2.1% each year.
These figures show that over time, ProfitShare could help to increase Harry's pension savings from £186,000 to £192,000. This would give him an extra £6,000.
You should remember that this is only an example and investment returns are never guaranteed. This means that while there's a chance your savings could grow, they could also fall in value. So you could get back less than what you started with.
ProfitShare - Why our mutuality matters
A company that puts its customers first. You've heard it all before, right? Well for us, it's the very foundation on which we're built.
We want you to feel the benefit of being part of Royal London. That's why we'll aim to boost your pension savings by adding a share of our profits to your plan each year.