The Fortress Plan aims to make all costs very low and transparent, make the application process very simple and most importantly look to remove some of those historic hurdles to setting-up a personal RATS.
The Fortress Plan is a multi-member RATS, a tax efficient form of saving that aims to help you ensure you are able to live a comfortable life once you retire. The Fortress Plan is a Section 157A compliant pension scheme (Income Tax (Guernsey) Law, 2005) and in obtaining membership of the Fortress Plan, you have a trust established in your name. This becomes your personal RATS. There are a number of ways this can be done and it can be funded by yourself and/or an employer.
The first and simplest option is that an individual RATS is set up in your own name and both you and/or your employer can pay directly into it. A Fortress RATS is very quick and easy to set-up, simply fill out the Application Form and the Bank Instruction Letter and send along with the required documentation to either your Independent Financial Advisor (“IFA”), Praxis Trustees Limited (the “Trustee”) or MitonOptimal Portfolio Management (CI) Limited. After that the Trustee will do the rest and send out a certificate and further information once everything is completed.
The second option is that you can join your company’s Fortress Employer Pension Scheme, a popular option for employers who wish to make direct pension contributions to a RATS set up in your name but with payments directly managed by them. For the time that you remain employed with your employer, your sub-trust would be funded in accordance with your employment contract, subject to any pre-set limits etc. In the event that you should leave that employer, that sub-trust can remain in place as yours, within that employer’s scheme; be transferred to another employer scheme or simply commuted to a stand-alone personal Fortress Plan RATS at minimal administration cost. This all makes the Fortress Plan very portable and it is a solution that can remain with you until retirement, helping you avoid the problem of multiple and potentially costly pension plans.
When you set-up a RATS the States of Guernsey also offer tax incentives to employees and the self-employed to contribute to pension savings and as a result the Fortress Plan really is a cost-effective pension solution.
How is the Fortress Plan managed?
Once your Fortress Plan RATS is set-up, your regular and/or lump sum payments are added to the fund(s) of your choice on a monthly basis; invested on your behalf into a mix of underlying strategies, comprising of equities, bonds, property, cash and alternative investments, depending on the strategy you chose. MitonOptimal CI ‘actively manages’ these funds, which means that the underlying holdings are constantly monitored and adjusted by investment experts, aiming to make your pension work harder.
Summary of Benefits of the Fortress Pension Plan
- The Fortress Plan is a cost-effective Bailiwick of Guernsey-only scheme that is designed around the needs of local residents. Each plan is individual – tailored to your expectations with a straightforward choice of investments.
- A Fortress Plan RATS is very quick and easy to set-up, simply fill out the Application Form and the Bank Instruction Letter and send along with the required documentation to your IFA, Praxis Trustees Limited (the “Trustee”) or MitonOptimal CI.
- You can start a Fortress Plan RATS with as little as £100 per month, or with a lump sum in excess of £1,500 and There is no maximum investment limit into your Fortress RATS.
- It is one of the lowest cost RATS available in the Bailiwick of Guernsey. Fee Schedule
- The fees associated with a Fortress Plan RATS are simple, highly competitive and most importantly, they are explicit. The Fortress Plan has been designed as a solution for your retirement, not for the early retirement of others.
- You can choose how aggressive or cautious the investment in your RATS is from a simple range of investment strategies.
- You can change your investment strategy as often as you wish.
- You can increase or decrease contributions and add lump sums or freeze your contributions at any time. (Subject to a minimum level of £1,500 within your pension pot at that time)
- It is portable and can be transferred to another approved pension scheme.
- A Guernsey RATS is a tax efficient form of saving that can ensure you are able to live a comfortable life once you retire. The Fortress Pension Plan is a Section 157A compliant pension scheme (Income Tax (Guernsey) Law, 2005) and your pension subscriptions are tax exempt, up to the limits prescribed by the Guernsey Tax Office.
- It offers the ability to receive tax relief on contributions throughout the term of your RATS.
- It offers the ability to borrow from your RATS ahead of retirement.
- You can take a tax-free lump sum on retirement.
- 100% of your contributions are invested, on a monthly dealing basis.
- It has a fully flexible retirement age (50 – 75 years).
- Fortress Plan Members do not have to purchase an annuity immediately on retirement*, or at all if the Member’s pension pot is sufficient to cover them for an acceptable period of time.
- The Fortress Plan is designed around the needs of locals, and managed by local professionals.
- There are no automatic IFA fees levied on transfers-in.
- Each Fortress Plan is individual – tailored to your needs and objectives with an uncomplicated choice of investments.
- The Trustee is completely independent of MitonOptimal CI, the Investment Manager.
- In the event that you are a Fortress Plan Member through your employers, you still decide on your own risk profile. You will be updated annually on the value of your pension and you can change the risk profile at any time.
- You can access the details of your pension online via our secure online Portal.
- On death, before or after retirement, the remaining value of your RATS reverts to your specified beneficiaries.
* Through a traditional pension plan one is typically required to use the money in the “pot” on retirement to immediately purchase a compulsory annuity. This annuity dictates the level of income you receive for the rest of your life. Annuity rates are affected by a multitude of factors, including expectation of interest rate movements. If annuity rates are low when you retire with a traditional pension, this can affect the income level you receive until your ultimate demise.
Learn more about the Fortress Pension Plan
To learn more about the great options that the Fortress Plan offers you, click on the links on the right of this page to download the relevant documents and forms or you can also request printed copies to be posted out to you. We will also be pleased to discuss the Fortress Pension Plan with you, but we recommend that you consider taking advice from an Independent Financial Advisor (IFA) when choosing a pension provider and we can recommend a number of reputable IFAs within the Bailiwick of Guernsey.
It seems to be customary to put warnings in the small print, but we would rather that each member is fully aware of the potential risks, as well as the rewards, of investing in funds. Although the Funds are not intended to track stock markets, there will be periods of times when fund values go down as well as up, and we expect all fund choices to have periods when short-term losses or flat performance are likely; this is normal. The important factor is that your fund choices perform positively over the longer investment period, referred to as your “investment horizon”. The sooner you set-up your RATS, the longer that investment horizon is.
The life span of a member of a RATS, and the investment performance of the assets held in the RATS, are impossible to predict. As a result, once a member has started to draw down benefits from the RATS and depending on the level of benefits paid, the assets may be exhausted before the death of the member.