WealthTalk - money, wealth and personal finance.

What Is A SSAS Pension?

Episode Summary

Discover the best-kept secret to building substantial wealth in this episode on SSAS pensions. WealthBuilders' Founder Kevin Whelan and SSAS Director Paul Brooks guide you through the ins and outs of this powerful financial tool, showing you how to grow your business, expand your property portfolio, and accelerate financial independence. Whether you're a business owner or not, learn how SSAS can empower you to take charge of your financial future and build lasting wealth. Tune in now for essential insights!

Episode Notes

In this episode we reveal one of the best-kept secrets to building substantial wealth: the SSAS pension. 

If you’re serious about building your financial legacy and expanding your investment options, this episode is a must-listen.

WealthBuilders' Founder Kevin Whelan and SSAS Director Paul Brooks, are two seasoned experts who have helped thousands of business owners supercharge their wealth through the power of SSAS pensions. 

Whether you're a business owner or not, Kevin and Paul will guide you through everything you need to know: how SSAS works, why it's so effective, and the eligibility criteria to start benefiting.

You'll learn how to unlock the incredible potential of SSAS pensions to grow your business, expand your property portfolio, and accelerate your financial independence. 

If you want to harness this unique tool to take charge of your financial future and build lasting wealth, then this episode is your perfect starting point. 

Tune in now and empower yourself with this vital knowledge!

Episode Transcription

Speaker 1  0:01  

The purpose of wealth talk is to educate, inform, and hopefully entertain you on the subject of building your wealth. Wealth builders recommends you should always take independent financial tax or legal advice before making any decisions around your finances.

 

Speaker 2  0:17  

Today's episode is brought to you by wealth builders membership a proven step by step process that helps you achieve financial security within two to three years. Find out more head to wealth builders.co.uk forward slash membership.

 

Christian Rodwell  0:32  

Hello, and welcome to this week's episode of wealth talk. My name is Christian Rodwell, the membership director of wealth builders. And this week, we're unveiling one of the best kept secrets about building wealth, the SAS pension. Now in just a moment, we'll be replaying a recent webinar hosted by wealth builders founder Kevin Whelan and SAS director Paul Brooks, who between them have helped 1000s of business owners leverage their existing pensions to help them grow their businesses and their property portfolios alike. Now, this podcast is for business owners and non business owners. And Kevin and Paul will cover everything you need to know about a SAS pension, how it works, and the eligibility criteria. And if you'd like to chat with us about your pension and see if we can help you take control and make it work harder for you, then please do get in touch, drop us an email at Hello at wealth builders.co.uk or head to our website, wealth builders.co.uk and schedule a call at a time that's convenient for you. We're always happy to help and guide you as best we can. All right, let's head on to our conversation about SAS pensions.

 

Unknown Speaker  1:37  

So what on earth, Paul is a SAS?

 

Speaker 3  1:39  

Well, it's a really cool and entrepreneurial way to make your pension work, make it work in a way that is linked to your business and property and really allows you to accelerate the property in the business in a way that you just can't do with any other type of pension.

 

Speaker 4  1:58  

But it's a tax free Trust Fund, right, which is quite fundamental as well. It is

 

Speaker 3  2:02  

absolutely you know, you build a nest egg, the golden egg there and pass it on to your loved ones without any inheritance tax at all. And whilst you're doing it whilst you're building it. It's free of income tax capital gains tax corporation tax all the taxes. So, you know, you're basically benefiting from the double tax wetly tax free growth for many, many, many years. And then pass it on free of inheritance taxes, the people you love, man

 

Speaker 4  2:26  

tax relief if you pay contributions in as well. So you get back. And that basically means you've got a almost a frictionless fund that can grow exponentially, which can help your business, your property business, your overall wealth, and of course, your family. Because in the end when people get into property or business in any kind, Paul, the number one reason people give us is I'm doing this to not just build wealth for me, but to build long term intergenerational wealth.

 

Speaker 3  2:58  

Yeah, absolutely. Family is always key, isn't it? Okay,

 

Speaker 4  3:02  

so introduce yourself, Paul. Yeah, well, delighted

 

Speaker 3  3:05  

to so my background is as a financial advisor, I always really enjoyed the more interesting and entrepreneurial parts of the sort of financial advisory world rather than the bog standard stuff that led me to connect in the UK in a course and for a long time we work together now, my passion is SAS, I had the SAS team here at wealth builders as the as the SAS director and had a great deal of fun creating and building, you know, the educational content that that our members get access to. So

 

Speaker 4  3:38  

congratulations to you to Paul for the hard work of getting CPD accreditation, which means we can teach lawyers this we can teach accountants this. So we're definitely in the right place to be able to teach you and while Paul has got the absolute expertise in terms of his background, and I have a similar background, just just a bit more crustier in the in the years. But my priority is always to be how to create multiple streams of recurring income, both in your business and in your life. And I'm passionate about that. And anything where there's a consumer champion position to take, I'll take it. And for the most part, all of the things I've written, all of the things we do in wealth builders, are driven by showing people how to create more value for themselves. So that in the end, the whole family prosper. And we're very passionate about that. I think we're the only company in the UK, if not even the world that's completely holistic in all aspects of wealth, and also in all aspects of the family. But we won't be talking about that we'll zero in on SAS. So, Paul, who are the two key people, the two key avatars, let's say who really can gain massively from an understanding of stuff. The

 

Speaker 3  4:55  

most common P set of people that we work with the property investors and motivated to find new ways of making their property deals work harder or to get new sources of funding to acquire more assets and more income. So if you were a limited company, property professional, you're a director of a limited company, then SAS is absolutely for you. If you're a business owner of any kind, and you've got a limited company, whether it's manufacturing, retail, consultancy doesn't matter, any type of trading active live business, then a SAS can massively help you. And

 

Speaker 4  5:33  

what we've seen over recent years since governments and timely intervention in the property world and what's colloquially known as Section 14, now going back to whatever that was 2017, now, we've seen a proliferation of people who used to own property in their personal name, now own property and a business name, and creating limited companies every day. And as a result of that, so many more of them have become eligible for this discussion. Whereas historically, where they didn't have a limited company, that wasn't even possible for them, was it? Not absolutely right, kind of had some headline benefits of SAS, definitely, if you're into property, you can just buy more. So getting more property and not having to traditionally put your pension in a box, do not disturb the 65 and access that money there. And that danger is getting pushed further and further back as state pensions change. No question about the legacy benefits, often poorly understood how pensions transfer on death. Anybody who's in business is making profit is the intention, you're going to pay tax on the profit corporation tax didn't go down, did it in the last budget went up. So if you're going to pay more corporation tax, any contributions you can use to get that tax back. So you can basically get your cake and eat it. So you get tax relief. And then you've still got access to the money to grow your business, or grow your property business, which is a little bit more alluring, I think, than sticking all the money, hopefully on a stock market that might deliver one day someday, but you've got no access and control now. And that's why many business owners are switched off pensions historically poor right.

 

Speaker 3  7:19  

Now we hear a lot, don't we, my businesses, my pension or my property is my pension. But actually, your pension can be a significant part of a well thought through strategic wealth plan, especially if you've got the right vehicle.

 

Speaker 4  7:33  

And then talking about funding, particularly for you property. People out there, you've seen what goes on when you kind of face the world and of institutional funding, you're applying for money, you're being underwritten. And when you're under being underwritten. Obviously, you're not in control. And we've seen a massive change in mortgage rates, you know, fixed rate, the fiasco that's been going on there, as people move from 1%, up to 5%, on fixed rates. And some of those know that the chickens come home to roost pretty quickly when you move on to those underwriting is God tighter. And when you've got less control, it's almost like your wealth plan is not fully on track. You always have to be underwriting or being underwritten. Rather, we're going to show you how to do here's how you can actually underwrite yourself, how instead of asking for money, you've got access to money, more often you didn't even know was there. And the big thing, and you mentioned a minute ago, most business owners tend to kind of put the pension off and build the asset in their property business or in their conventional trading business. And pension is just too far in the future. So they're not motivated by it. But what we see, as people discover sasses is it can provide you income, and your life today. You know, this guy here looks like he's in his 30s. He's not in his 60s. So you just don't need to wait to get access to the money. And that's a big change that most people just simply don't put two and two together, Paul, on that one. And when they get the message, they suddenly like pensions. And we've been in rooms before. Certainly where we've had on zooms definitely in COVID we had 1000 people in a Zoom Room, or getting excited about the thought of being able to touch and trade and get involved with their pensions in a way they couldn't do before. So pensions can be exciting. Is that even dare to say that Paul, do you think? Yeah, I

 

Speaker 3  9:34  

think you can we know for sure that it's true. So look, hopefully, people watching today will get a sense of that excitement as we teach them a bit more. All

 

Speaker 4  9:42  

right. But let's caveat things as normal. Wealth builders do not give regulated financial advice. So in this this is an educational webinar is not meant to be prescriptive. SAS isn't for everyone. There is no risk free investment in the world. And if you've ever Listen to Our Podcast, the podcast called wealth talk says exactly here what it says in the podcast that we always recommend you take independent tax legal, or financial advice before making decisions about your money, we'll do our best to give you some reason to maybe to to ask for that, whether it's from your accountant, or from you know, somebody who's trustworthy. But we're seeing generally out there really bad outcomes, when it comes to pensions, the vast majority of people in this country are retiring poor, the average income in the UK in retirement is around 1212 15,000 pounds a year, depending on where the state pension kicks in. And for most people, that date is getting pushed back, and back and back. And with kids today, living to an average of 100 years life, you know, they're not going to see their state pension, anywhere near the 60s, that's going to be pushed back into the 70s. And even beyond that, but notwithstanding retirement, generally, in the UK, is a hope for the best plan with zero control, because almost all of the money, and we see this, and people kind of do it because everybody else does it is they get on a stock market roller coaster ride. And we've seen the tragedy of that, think back to 2008 2009, when the stock market crashed for average people, around 40 50% of their money just wiped out in a heartbeat. And you can't recover from if you're retiring at a point when the market crashes, you are done. Your your future lifestyle is compromised, and you're not really going to be enjoying them. Definitely one of the big things for us. And I know for our partners that wealth builders who we work with, most people are paying too much. You know, the technology and AI and all sorts of benefits have been brought to the ability to manage money at very low cost. But unfortunately, most people kind of stick with being a retail customer buying things from the traditional intermediation you through advisors and through platforms and through and the layering of charges, which is typically around 2%. And an average stock market paying, let's say, 6%, that's a third of your money going in fees. And that gets worse when you get older, poor because most people reduce their risk, don't they, when they get older than that 2%. If the market goes 4%, because you're buying lower risk investments, you could be having a joint venture relationship with the financial institutions taking half your pension. I mean, it's sounds laughable, but it's a tragedy. And there are so many ways that if you take control of your pension, even if all you want to do is invest in the stock market, where you can both reduce the costs and reduce the risks. But that's kind of beyond the scope of of this webinar. Today, we're talking about more about how you can take control. And what people tell us they want is I want money now. And I want to build my wealth today. I don't want it for the long term. And I want to be able to build it in a way that controls and passes to the next generation. And rather than be completely on the stock market, I want to be able to diversify. How important is diversification pool?

 

Speaker 3  13:17  

Hugely. But having all the eggs in one basket is so critical to a sustainable future, frankly, isn't it you know, income from multiple sources means you're not reliant on any one thing.

 

Speaker 4  13:30  

I was doing an interview yesterday with the absolutely brilliant Louise Hill, the founder of go Henry, he said the biggest lesson in life, no single point of failure. And most people have a single point of failure. In fact, actually they have a double point of failure poor they have their all of their money in their pension, the stock market and all their money in their ISIS on the stock market. And there's no real diversification there. So the ability to invest in property, in business in gold in crypto in whatever you want to do. We're not recommending any course of action here, as we said earlier, but whatever you want to do to diversify, a SAS can allow you to do because you take that control and you keep therefore much more of your own money because instead of being a retail customer, you turn into a wholesale customer, which allows you and those of you in business know the difference between retail prices and wholesale prices to switch the dynamic, the fees from a percentage of your money for life to fixed and often low cost administration fees. And we'll talk a little bit more about that as we go through. So Paul, what are the key benefits you mentioned? You can't do certain things in a more traditional pension, like a workplace pension, a personal pension, a stakeholder pension, all the languages have pensions, but what's the key points that we find most people value when it comes to sass? Well,

 

Speaker 3  14:56  

I think choice and freedom is is a significant benefit. Fear and that ability to diversify, coming back to your point from a few minutes ago diversify into things that they understand more. Business owners understand their own business property professionals and investors and entrepreneurs understand property, they don't understand the stock market, or they don't want to understand it, because it's unruly, and it's volatile. So I suppose the thing that SaaS allows you to do in a way that no other pension does is use your money in a way that's aligned to your own skills and your own passion and your own interests and the things that you know how to make work,

 

Speaker 4  15:33  

while you decide you want to invest in learn. So if you are new to a certain investment, or a certain asset, an asset that can give you some cash flow in your life, then you can do that, including, of course, a SAS is really a bank account, a giant bank account, Trustee bank account, and that money can be invested in lots of different places. But also, you can instead of being going to a bank, you can be the bank. And that means either lending money to you, or lending money to your property, business or lending money to others, all of which will have pros and cons. But all of which you've got a much more personal and a more relationship, and a more controlling perspective. Because you can get your hands on and make the decision for yourself, rather than hope the stock market kind of works out for you, which, if it does, great, but if it doesn't, you, you'll find out about until it's all too late. So let's let's talk about some of the things. So the more popular things that people do. And of course, we've helped 1000s of people transition from traditional pensions into SAS, so we can't cover everything. Who wouldn't possible to do that we'd be here for hours, not just an hour. But in terms of buying commercial property. What are the sorts of things and some of the benefits of that? Well, we've

 

Speaker 3  16:56  

listed I suppose the sort of the most commonly used strategies with commercial property. But your SAS could ultimately be the landlord of a commercial premises. And there are multiple benefits of that if you're a business owner who needs a premises, and you're renting, you could buy your own premises, and then pay rent to yourself, which generates a new stream of income into your pension that wasn't going into it before. If you own your own premises already, you could actually have your SAS buy your premises from you. And then you're effectively keeping hold of that property, that asset that you need to run your business from. But you're now creating a brand new stream of income, that is also tax deductible to the business that wasn't being paid before. So you're getting tax relief on money that's going into your pension. And there are lots of neat things you can do, especially if you've got a building that is bigger than just the space needed for one business to occupy it, you know, so, subletting space in a larger building to other businesses, gives you the ability to generate extra streams of income in your life into your business. So your business contenant the property and then go okay, well, I don't need half of this, I'm gonna stop, let some of that, and then that generates a stream of extra income into your life that you didn't have. And we touched on that, at the beginning of the presentation here didn't worry about getting income in your life today from your SATs, rather than waiting until, you know, traditionally 65.

 

Unknown Speaker  18:21  

And what's the leverage point in?

 

Speaker 3  18:23  

Yeah, SAS has got the ability to borrow money. So if you're buying a piece of premises, it could be a piece of land, or it could be a building a commercial building of any kind, you can go and get a commercial finance, from a bank from a bridging company, and even technically, from passive investors. But most commonly, it's from banking institutions, taking a long term leverage position just like you would if you were going to get a mortgage yourself with your own money. That doesn't

 

Speaker 4  18:49  

happen in a conventional pension. If you got that pick a number you know, call it 100,000. Just because it's an easy number in your pension fund with a big insurance company and you say, I quite like stocks and shares, I think I'd like to buy more. So you knock on the door of NatWest and say, Hey, will you lend me another 200 grand so I can go off and buy some shares or some some gold or some crypto or whatever, whatever the answer is going to be? No, but if you're looking to buy property, of course, the answer will be yes, of course, you can do that because of the security angle. And the the ability to generate an ongoing income. So all of these things are very valuable. And I know I spend a lot time Paul talking to company owners who've got premises in their own limited company. And we migrate that into the SAS because not only does it ring fenced and protected, because the SAS is ring fenced and protected. It's wrapped up in legal bubble wrap so nobody can touch it. Creditors can't touch it. Revenue can't touch it. Nobody can touch it, it belongs to your family wants and set up. So if you put your property into that And then you've ring fenced out from the business. Whereas if you got the premises and the business together, and something happens to the business for good or for bad, you've got a bit of a challenge, if it's for bad, and the business goes in a negative direction, we saw, obviously, the fact COVID, then your property can be caught up in that. Whereas if it's separated, it can't be, and for good, you sell your business, fantastic, then you've still got the property which you could rent to the buyer of your business, and get a tax free rental income, and no inheritance tax to pay for the next generation as well. So I know we're going pretty fast and thick and fast. And you're not going to be an expert in 30 minutes that it's taken me 30 years and poor slightly less, to master these skills. Okay, now, property developers kind of slightly different view, not buying commercial premises just to own but to do something about the development. So they bring in their own intellect, their own team, their own knowledge, and more often than not gaining incredible additional value, whether it's land and commercial property, whether it's the conversion of property, we see a lot of conversions from commercial into residential under permitted development rules, all possible. With SAS, you can apply for planning permission to get an uplift in value, but you're always in control as to when you want the SAS to play. And when you want to step in and create the value. So you want to give an example of that pool. So

 

Speaker 3  21:36  

you know, your SAS could buy a piece of land, and it could start to build having got the relevant permission gains, you know, the shell, the framework of a nice four bed detached house, and then strategically choose to, to exit that development. And ultimately, there are several ways but traditionally sell that development. And it's part completed state to your business, which means you're choosing the point at which you exit, which means you've got control to some extent over what part of the what stage of the development you exit, and when and why and how you get financed, for the purchase and so on. It also means you get to choose how much of the profit you make on that build up to that point to keep in the SAS, which of course means you can choose how much is tax free. And how much profit then arises in the business, which might be taxable, but it's money in your hands now. So you've got the ability to sort of in a nutshell, choose where you want your wealth to be. Do you want your wealth to grow in the tax free environment in the SAS? Or do you want it to grow in the environment and the business where you can have access to those profits as the owner?

 

Speaker 4  22:48  

On the key though, the key for me is not what does that look like today, but just that word choice. If you've got the choice you choose, where you want the value and where you want to roll up the value, it's a matter for your personal choice, you cannot do that. In conventional pensions, you know of any choice. Everything is a roll up. There's not no possible to extract money before the age of 55. And that's going up to 57. Anyway, in 2028. And where is it going to go from there, we're not going to come down again, it's going to be getting pushed back, as I mentioned earlier on with state pension. So the same thing, so you're getting the chance to collaborate with your business and share profits and share value along the way. I mentioned Paul, the don't go to a bank be the bank. The bank itself or the Bank of SAS is an interesting way not just to lend money to your own company to do what you want to do but but lend to others and act with the same value creation, the same integrity, the same security as a conventional bank would do. And I know certainly from my SAS I frequently being a bridge to other projects. What does that actually mean that important? Well,

 

Speaker 3  24:00  

it means you getting to choose and select good people that you want to work with and lend one or more chunks of your Sass pot to them on terms that you basically agree. So you can choose whether you get a straightforward interest rate or actually you also potentially share in some of the profit. You can choose how and where your money is secured and what protects it to make sure that you do the best job of getting the money back if things go wrong. And of course, sometimes they do go wrong. You can leverage on the skill and the knowledge of that person and find a way to learn something along the way. So you could lend to someone who does something that you're really interested and you want to learn a bit more about and you could go to site and you could see what they do and you could tap into their knowledge and get an extra ROI as opposed to just the straightforward return of money on your investment. Okay, interesting. You can shape the deal in pretty much any way you want. So Unless it's commercial, it's an

 

Speaker 4  25:01  

interesting one, this one because I mentioned earlier on, when we're chatting about this concept of, more often than not, when you're in property or business and you need capital, you're having to go to be underwritten. In a case where you're the bank, you're the underwriter, you're the one setting the terms. And there's a skill involved in doing that. But frequently, for example, you know, in loans I've done getting first legal charge security and decent double digit returns. But that's just some of the ideas that can be useful if you don't have the time, energy, inclination skill, to do the property development work. But you see that other people are doing a great job, whether it's just in terms of the value they create, or the impact they have in society, because they do environmentally friendly property or properties that serve a certain tenant type that you really see the value in supporting so many ROI is, as you mentioned, Paul, but more often than not, instead of lending to others, people want to get access to the money themselves and be their own bank for themselves. So what does this mean? And how does this rule work, where you can be your own bank and lend money, as we say here, low cost development, finance, how low cost? How does it work,

 

Speaker 3  26:20  

so you can borrow up to 50% of your sasses value into your limited company, for any legitimate purpose. So if you're a property developer, or a landlord, professional landlord with a limited company, and you want to borrow some money, to develop a buy, to let into an HMO, or to do a con to resi, conversion, anything, doesn't matter, which I'm just giving a couple of common examples, you can borrow up to half of your SAS pour into your business to do that, and you pay an interest rate back to your SAS. So the business if borrowing finance would have to pay interest to somebody typically, in that sort of scenario, a bridging company or maybe a passive investor. In this case, you're paying that interest back to your own pension. Now, interest rates are obviously a bit higher in the last 12 months or so than they have been for a long, long time. So this is still a low cost development finance solution, you'd be paying one plus the base rate. So roughly 6%, let's say just for the sake of picking an easy finger at the moment, which of course still compares very favourably to the kind of rates that you'd be paying if you were paying finance to an institution. And without all the extra 1000s of pounds of in costs and out costs,

 

Speaker 4  27:37  

and underwriting time and fees. Right. Exactly. Right. Yeah. Even gospels broadly similar. You're paying it yourself. Exactly.

 

Speaker 3  27:45  

And, and of course, that's all going tax deductible for the business makes you a corporation tax saving tax free in the hands of pension, which you can then use to develop in another way, you know, through a different strategy or even to lend back again on a different loan.

 

Speaker 4  28:00  

And there's no surprise, then that is probably the most popular strategy for our property owner clients, right?

 

Speaker 3  28:07  

Oh, absolutely. Absolutely. And one point just to make, which is just it does need a first charge security. So you're lending on the same sort of broad commercial terms as a bank would lend, you know, there needs to be security. And I'm sure we'll get questions about that, which we can cover later on. Yeah,

 

Speaker 4  28:25  

and just a point we haven't raised specifically, but I'll mention it now is that the SAS can, as a group scheme, really, it can accommodate up to 11. People why? Because that's the law says if it's more than 12, you're in a different pension landscape. Think about that for a moment, you talk about the amount of money that's available more, more often than not, in fact, in all cases, when you've got a pension, it's you. Your pension is here, your spouse's here, your children's here, your business partners here, all the money separated. And that makes it sort of less controllable. Whereas if you imagine, you put people's money together, you know, your own family, typically husband and wife, maybe business partners in a business, and you put that money together. And then you look at your 50%. Paul, as you mentioned earlier on, then it's 50% of a bigger pot. And if you're lending money to your own company, it's 50% of a much bigger part. So the idea of collaboration and connecting very, very big deal when it comes to SAS and people don't not used to seeing pinches as a collaborative tool. It's much more about paddling your own canoe, but the sticks a turbocharger on the on the back, on the back of it anyway. What about some of the more nuanced ways that that people can access money because we're always taught on we all we always hear, wherever we hear it on Facebook and social media are from traditional financial advisors, you know, you you can't really do residential property and pensions, they just don't go together. But you did mention just a moment ago. You can do it through the loan back. But what are some of the other properties that we call exempt residential properties that people could actually buy rather than just lending money. And using half of their pension pot, they could use all of it.

 

Speaker 3  30:12  

If you look at the type of property that we're we're using as an example, these are things that are not dwellings they are not single family dwellings, they are not, you know, your common to up to down terrace house, they are sort of slightly unique spaces designed for people to live in, but very often not permanently, and with a more commercial slant on them. So you know, student accommodation, done in the right way, is a perfectly good example of a property that people live in, perhaps for a year, perhaps for longer, but he's not classified as a residential dwelling. And so he's allowable, within a sense, okay, social housing also really popular, you know, creating secure environments for refugees, or for alcoholics recovering or any number of different social groups that need a little bit of extra support. You know, it's something that people are becoming a lot more socially aware of, and feeling like they want to use their money in a way that does good as well as gives them a good return. So you know, the kind of things that other pensions won't really can't allow you to do a SAS can get you to do,

 

Speaker 4  31:27  

and definitely seen, you know, interest in some of our clients, around the children's homes and so on. So where there's an element of datian plus a service, then that that tends to go together as even a way to look at all bed and breakfasts and convert those into serviced accommodation units, as well as their bigger care homes. I mean, there's a massive scope for the increase in care provision as we get older, and they're just not the same way, there's hundreds of 1000s of homes that need to be created. For accommodation, there's hundreds of 1000s of rooms needed for care, they're not being provided. So if any of these areas appealed to you, or you're involved in these areas now, then it definitely could be something you could give yourself a bit more control over access to funding. For all the things we've been talking about all the benefits. And I mentioned the ring fencing. My particular passion around SAS is family. Anybody who knows my story, you know, knows that my father died very young didn't leave anything. And if anything left a more challenges than not been SAS is the best thing I've seen. To help intergenerational wealth, I mentioned the ring fencing, but because you can invite children from age 18 into your SAS as trustees, then you've got the ability to be able to almost begin to invite them into a family wealth discussion, starting from the point of the pension, where they probably wouldn't be thinking about pensions, 18, but they can see this family wealth growing there. And they can get involved in some of the decisions, or even just observing that. And we've got lots of other more tactical things that come up, when traditional pensions have got to pay out within two years of death. Whereas the SAS doesn't, because the family members are still in the scheme. And that way, they've got control of that money for a much longer time. So lots of good reasons why the family legacy and sasco so, so well together, Paul, and we absolutely see how people get sort of turned on to creating a wealth family as opposed to a pension product. But you know, we mentioned about it's a high performance vehicle or a turbo charge, and like any high performance vehicle you need to know about so we're going to share with you just a little of the eligibility. What are the key things that have to be in place in order for this to be possible for you now know these well, because we can't really help you if you don't fulfil the criteria and I often call these the right private limited company the right person, the right pension the right plan, Paul, but here we saying assessing your business, which I would call you know, you got a private limited company, what do they need to have in their limited company or the history of their limited company to be eligible? Just

 

Speaker 3  34:39  

some genuine activity needs to be live it needs to be doing things I'm deliberately avoiding using the word trading because lots of people misunderstand and think that a trading business one that provides or sells goods and services can have a SAS but an investment business one that owns assets cannot and That is not the case. Whatever you do with your business, you are entitled to create a SAS. As long as it is doing things, it's active, it's live, it's operating, it isn't just a shell with nothing in it. We

 

Speaker 4  35:14  

often hear other people say, Oh, it needs to be trading for a year, needs to be having this much profit. Lots of things being said, but in pensions law specifically, and we study that that's just not the case. And but you know, some other eligibility criteria as well about, you know, the nature of your connection to your business. Yeah, so

 

Speaker 3  35:36  

that Yeah, that's right. Yeah, you must be a director or an employee. And typically, most people are directors, aren't they? Of course, you know, most of the people that we speak with are the director owners of their business. But if it's, for example, a spouse's business, you could with their agreement, be director and that would allow you and then potentially the spouse, your spouse to collaborate together on it. And

 

Speaker 4  35:59  

again, what about family members, you know, you've got grown up children like me, you want to invite them in? How's that work? Yeah,

 

Speaker 3  36:05  

it's perfectly fine to bring them in. But nowadays that are bearing in mind that there are two ways to bring money into a SaaS one is from an existing pension you've already got, and the other is a new contribution. In either case, you need to be a credible associated party to the business. So at the very least, they would need to be on the payroll. But as long as they're old enough, and of course, to be a SAS trustee, you must be at least 18. Anyway, they could also be a director, and there might be benefits of using that structure for your children as part of a business legacy plan in any case. Okay.

 

Speaker 4  36:39  

Let's talk about where that money will come from then just mentioned that seeing pensions and contributions, but what are the sorts of things that you need to do to her to take a look at that and assess not just where they come from, but in due course, the value of that to make it make sense? Yeah,

 

Speaker 3  36:56  

we think that, you know, for people to be able to use Sass in this sort of entrepreneurial style that we've talked about it today, depending on where you are in the country, and your strategies will obviously have an impact. But really, we think you should probably start with at least 50,000 That sort of baseline either from an existing pension or several existing pensions that you're amalgamating and bringing in or from profit that you've got in your business that you can pay in or even technically, from your own personal resources, any combination of those three things, but we say that to make the most of SAS and to be able to do the things that we've talked about, and some other things like crypto and crowdfunding, which we haven't spent any time on today, but certainly things that can be done, realistically, probably need about the 50,000 plus value.

 

Speaker 4  37:45  

And more often not when we see husband or wife 50,000 The other one's got maybe 30,000, you can amalgamate those things together, as long as you've got people seeing eye to eye, and just the advisory portion. And we said earlier, ob we're not giving advice, and we don't give advice. But sometimes advice is absolutely needed. Yeah,

 

Speaker 3  38:05  

absolutely. You know, sometimes people, particularly with existing pensions will have pensions that may go back to a point in time where they're also different. And that means that some of the features of those pensions may be very valuable. And transferring a pension means you lose those features. Now, not every pension has it. In fact, it's far less common nowadays, as people have already switched into newer things, but getting a really good understanding of what your existing pension has the features and the benefits is so critical. And sometimes, that can mean it's well worth spending time with a financial adviser to understand those things. And sometimes in less lesser circumstances, you may be required by law to take financial advice. If you're certainly

 

Speaker 4  38:51  

for words like final salary, you might have heard those words, sometimes known as defined benefit, the language can be clunky, then you definitely need advice on that. There are some things which can't be moved, like public sector schemes, military schemes, teachers schemes, doctors schemes, dentists schemes, where the public sector schemes in them for the most part, where they're just no right to transfer, you know that that all got lost in 2015, when the government realised people were moving the money, but there actually wasn't a pot there. So that's all gone, I'm afraid so. But you know, you can build those contributions as well. And the contribution limits are now gone up to up to 60,000 pounds a year. And you can go back several years to mop up all contributions. So if you're thinking, well, I probably don't have 50 grand in my pension pot, but I've got a healthy profit, then just make a note of that. You can actually make contributions and I've definitely seen business owners where they've got small pension pots because they weren't interested in their pension, they suddenly get interested. And then those contributions start to flow because they can see what the country All of that flow is going to do for their wealth and for their family. Moving forward. Did

 

Speaker 3  40:05  

you see actually very quickly, Kevin, a question popped up on my screen about? Can you create a pinch SAS with less than 50? The answer is yes, you can, you were just sort of alluding to it there, you know, if you know that you're going to commit to paying money in, you can start with a small pot. And we do have people who start a SAS by drip feeding money in over time, but they have a commitment to do that regularly, and then review it regularly and reinvest the returns into it,

 

Speaker 4  40:32  

that needs to be part of a plan. And it's not our role to say and you'll see as we talk a little bit more about how you could get involved assess, was right for you, or even you think it's going to be right for you in the future. There are different ways that you can get involved and build your knowledge and build your confidence. And as wealth builders, we mentioned earlier on, we've helped 1000s of people cross this bridge cross this divide between not understanding and understanding. And that's the first part is not to make a decision whether it's right for you necessarily, unless you've already woken up. And well, this is a no brainer for me. But for the most part, there's a journey of discovery. And that journey, we help in terms of education. I mentioned, Paul, that created some absolutely amazing, high quality, CPD quality materials, the support for the people, we've got a community of around 5000 or so. And the connections as well with people who've done it before Been there, done that. And in the world of SAS, when you've never done it before, there's always a who, ahead of you, who has, it really is a journey of joint discovery. And we enjoy sharing, and seeing people build their confidence. And here's a sneak preview behind some of the work you've done poor, which is creating an online portal. I know we don't have the ability today to walk people through that. But we can do if you want to have a chat with us, we can walk you through it. But what are some of the headlines? Just in terms of the the access to the portal, the education that you've served skillfully? And, and diligently put together? Sure. Well, I mean,

 

Speaker 3  42:10  

look, as you can see, there, it's broken into, you know, pretty simple sections where we take you through a flow and teach you the basics of our SAS, and then helping you think about what can it do? And how can it do it? And what are the sort of key rules that you need to understand, or we then delve into the main strategies, you know, lending your money being the bank, borrowing your own money buying commercial property developing, and it's a combination of case studies, and sort of short, simple, easy to digest videos, and downloads and checklists that you can use practically. So it's a sort of combination of those things in a place where you can jump in and jump out. And if you've only got 15 minutes, fine, you can jump in and do 15 minutes, if you want to go for an hour and a half, you can go for an hour and a half, it's completely flexible.

 

Speaker 4  42:57  

Okay. And enough people have gone through that. And we work in addition, with ourselves as an educator, but in SAS, you always need an independent party who's keeping the money separate. And we call those the administrator trustees sometimes on the SAS administrator. But again, it's a slike acting almost like a regulator to your pension to keep your money separate, because you need to do that. But you and I have negotiated some very specific benefits because we bring the educational confidence, which then translates into unique benefits and including all inclusive costs instead of time based costs or project based costs. Trustees who recognise that the law allows many things and they take that sort of flexible approach, a rigorous commitment to service standards to make sure that you're getting what you need. When you need to do something sometimes in property, you've got to move very quickly. And if it doesn't work out for any reason, we've got enough flexibility to be able to move to another trustee free of charge because not everybody sees eye to eye on every scenario. But But overall, it's worked really well over the number of years we've been doing it but yeah,

 

Speaker 3  44:14  

absolutely. It's it's one of the biggest benefits really, you know that lifetime saving of cost because you're stripping out all those transactional costs that amount to a massive amount each year, sometimes if unchecked.

 

Speaker 4  44:26  

And just touching very quickly on some of the other things we do in terms of we have regular sessions, group coaching, to allow you to sort of learn a bit more not just on your own on a portal gorging, as Paul said, but you working with other people, as well and we love to get together and we don't do just do that socially. I know the red wine is for me. But we also do site visits where you can put on the hardhat, the high vis jacket, the sexy boots and you can be like a kid again and walk around and we're doing those things all the time. We got one next month to next month in March, actually one in the northeast and one in the Midlands. And we regularly want to show people, this is what you can do to bring your pension to life. And we have fun doing that. Lots of people giving us accreditation for how they've enjoyed the process of setting up their sasses. And you can check our Trustpilot reviews, they should speak volumes for us. So if you're doing some due diligence on us, please feel free to look at that. And one of the good things I just love this is we do such a good job that our SAS investors or SAS owners become award winners. And the last two years, there's been a property investor award SAS investor of the year, a wealth builder clients been the winner. This year, Toby and Kate won an award and Toby is now so excited about that he's now a coach for us. And he teaches SAS as well as part of our coaching team. So we're thrilled and delighted with the quality of the work we do because you want to get SAS, right, you don't want to be somehow caught out with something you don't know. And you don't understand. If

 

Speaker 3  46:14  

you're creating a SAS, you have to have a live active limited company, you have to be a director of that company, you've got to be somewhere along the road with some investment experience you are into property. You're a seasoned business owner or you understand business. And you've got the willing to invest in your own knowledge and your own, you know, your own education. And though not strictly speaking a requirement legally in any way. You know, we suggest that most people would want to have at least 50,000 pounds of either pensions, they can bring in all profit or both.

 

Speaker 4  46:53  

So if you want to get involved, if you already know some people will be already sort of have been researching this for a while and they kind of just needed the catalyst to go Yeah, I do understand it now. And we look forward to welcoming you into our SAS membership. If there's a level that's appropriate for you, or to have a call with you, we're relaxed either way, by the way, and we look forward to helping some of you cross the divide from pensions that don't work to pensions, you can only control and build wealth for you and for your family. So thanks to everyone see you again. So yeah.

 

Christian Rodwell  47:29  

I hope you enjoyed that conversation between Kevin and Paul. And don't forget if you'd like to chat with us about your pension, and see if we can help you to take control and make it work harder for you. Then please do get in touch. Just drop us an email at Hello at wealth builders.co.uk or head to our website, www dot wealth builders.co.uk and schedule a call at a time that's convenient for you. We're always happy to help. Okay, that's it for this week's episode. Take care See ya.

 

Speaker 1  47:58  

We hope you enjoy today's episode. Don't forget that we are constantly updating our resources inside a wealth builders membership site to help you create, build and protect your wealth. Head over to wealth builders.co.uk/membership right now for free access. That's wealthbuilders.co.uk/membership