About to retire, what next ARF or Annuity

So your coming to retirement

Over the years you've saved all this money in a pension fund, what next?
don't you just buy a monthly pension from a life assurance company?

We have a pension system in Ireland which is the envy of the world, where you don't just have to buy a monthly pension, we have another option, we can place our hard earned money into whats called an 'Approved Retirement Fund'

unfortunately it's not as easy as placing all you money in the ARF (Approved Retirement Fund)and that's that. Both the annuity and ARF systems have pros and cons. And before a choice can be made a good understanding of both systems and their pros and cons need to be looked at.

Annuities
An Annuity is a more commonly know as a pension, on retirement the person purchases a guarantee from a life assurance company that a monthly payment will be made by the company to the person for the remained of their life.

When calculating what the monthly figure will be the life assurance company look at:

• the amount in the pension fund
• your age and health status at time of purchase
• the type of pension you require (do you require a dependants pension)

Advantages of pension

• regular income for the remainder of your life
• once initial purchase is made no more investment is required
• Once purchase is made no more advice is required

Disadvantages

• If you die your pension dies with you and all that saving for retirement was for nothing
• Once level of income is set there is no changing it.

Approved Retirement Funds

Is essentially a bank account for your pension fund. Your pension fund is reinvested in assets such as shares, property, bonds and cash. The ARF is designed to continue to grow the value of your pension fund but your original investment is not guaranteed. You can withdraw income as you please, on which you pay tax as normal. Any money left in the fund on retirement can be passed to your next of kin.

Advantages of ARF's

• Keep control of your money
• If you die the ARF can be passed to next of kin
• Any growth in the ARF is tax free
• You can take as much or as little income as you wish (depending on the size of fund)
• The ARF can buy an annuity later on

Disadvantages of ARF's

• Your pension fund is invested. which means it's not guaranteed, (although a risk adverse strategy can be adopted)
• The Fund could run out before you die
• Pay for investment advice

As you can see the advantages and disadvantages for both a numerous. Different strategies suit different people, it's a very important decision to make so when making it take your time, sit down with your advisor and look at all the options available.

If you wish to discuss your options further please call on of the White Star Adviser's on 01 2932373. or have a look at our website at: whitestar.ie

We can help you make the right decision.

Best Tax Incentive Ever ?

Section 481 Film Finance - Get €3,300 of you tax back at no cost !!!!!!

Some people put this in place every year and reap the rewards, don't panic it's around until 2015.
It's what they call a no brainer.

• No up front capital required, money is provided by prearranged loan facility

• If you pay enough tax at the top rate you will receive €3,300 back into your hand

• Very low risk, out of 149 of these deals only 3 have fallen down, (all movies, to lessen the risk investment will only be made into TV programs)

Look at the finer points and have a good think about it.

What is the Film Finance (section 481)?

• Section 481 was introduced by the Irish Government in 1987 to promote the Irish film Industry,
  
• System for tax breaks on film production
• Tax relief on 100% of investment available

How Much should i invest?

• An individual investor can invest any amount between €10,000 and €50,000
• Investment amount should match income taxable at the top rate of tax
• Investors receive tax relief on their investment at the marginal rate of 41%
  

What is the investment process?

• Borrow €50,000 split into two loans (€33.4K, €16.6K)
• invest proceeds of the loan into film
• Receive film 3 cert, 2 months later
  
• give cert to employer
  
• gross salary adjusted for tax credits
  
• repay lesser loan using tax rebate
  
• keep the balance

How are loans repaid?

• Financing pre-arranged at start of the process
• Loan split into 2, €33.4K and €16.6k
• The smaller loan is paid off by your tax rebate
  
• Larger loan is paid off by producer of programme

What are the risks?

• The film does not get made and the revenue with draw tax relief

How can i apply?

• Call us on 01 2932373 and we'll do the rest.

We really see this as a great opportunity

www.whitestar.ie

Welcome blog

Hi and welcome to the first of many blogs from White Star Finance.

We've all seen alot of change over the past few years, with the biggest change probably happening to peoples personal finances. Since the start of the uncertinaty in our economy our clients have been asking our opinions on their personal finances and asking questions such as 'is the ECB going to cut the base rate? If so what does that mean to me?. Are the irish banks going to increase their margin, if so what will it cost ? Is it fair on the people of Ireland?'. And more recently with Whats happened between Quinn direct and the financial regulator people have been asking about thier health insurance 'are our policies safe, will our claims be met'?

The White Star Finance Blog is designed to answer the questions you may have regarding your prsonal finance, it will offer you insightful tips on how save money in these trying times and we'll offer our professional opion on the important topics that matter to you.

Watch out for the first installment of the White Star blog on it's way soon.

www.whitestar.ie