As with all aspects of Brexit and Leaving, the effect of Brexit on pensions has been subject to claim and counter-claim from supporters of both sides. So what might the picture be, when we do finally officially leaven leaves the EU? Let’s see what the experts are saying.
Trying to Understand It All Is Ambitious, Says Expert
Tom McPhail at Hargreaves Lansdowne is reported on the BBC website as saying that the complex dynamics in play mean that trying to understand them is an “ambitious” effort.
Mark Wilson, chief executive of Aviva, one of the largest pension providers and investors, is reported as saying that uncertainty tends to upset markets. A large fall in share values might knock pensions. This is especially the case with pensions which are long-term investments, maturing and growing over many years. In the long-term, Brexit might seem like a storm in a teacup, if for example, the Euro failed.
It may all seem a long way from ever happening but, we often rely on businesses to deal with complexity – in this case, making beneficial credit choices. But these major international and national questions have a habit of influencing our purchases at street level. The economy is so complex, and the world so full of connections between economies and countries, that it’s very difficult to analyse the various scenarios.
How Would Inflation Affect the Value of Pensions?
If Brexit resulted in a falling pound, would the Bank of England raise interest rates no matter what? The Bank has been even more opaque than usual. However, rising interest rates would of course be good for annuities, and therefore good for most people’s pension income. What ever the case may be it would probably be better to get a Gloucester Accountants company at links like www.randall-payne.co.uk to advise on what to do with your money, what to claim back if your able to, for example self employed workers.
There’s always a “but” however. And if inflation went up at the same time (caused by the things we import getting more expensive) then of course the buying power of pensions would be affected. So either way, pensioners would be no better off. Of course, if markets in the UK did fall, funds investing pension contributions in the market could always look overseas to get better returns, because investment firms now have a global perspective.
Either way, we’ll be in a better position to know as soon as the government decide when we are actually leaving.
