SSAS Pensions made easy – Property Nomad Podcast ft. Simon King

Podcast

SSAS pension expert and national speaker Simon King was invited on the Property Nomad Podcast to discuss why you can benefit greatly from pension schemes – and how you can pick the right one for you.

You’ll learn:

  • What a SSAS pension is
  • How to maximise pension growth to achieve a retirement that works for you
  • The easiest way to buy commercial (and even residential) properties providing you abide by HMRC rules
  • The differences between a Self-Invested Personal Pension (SIPP) and Small Self-Administered Scheme (SSAS)
  • How you can qualify to be a client of The Landlord’s Pension


Download the free SSAS guide featured in this podcast:
thelandlordspension.co.uk/propertynomad

Find out if you’re qualified for a SSAS:
thelandlordspension.co.uk/test-simon-king

Talk to Simon King:
thelandlordspension.co.uk/talk-to-simon-king


 
Alternatively you can read a transcript below:

Robert:                                                    
Welcome to another episode of Property Nomads Podcast, and I’m delighted to be joined today by Simon King of The Landlord’s Pension. The Landlord’s Pension has helped over 1,000 people invest in property since 2004, The Landlord’s Pension specializes in structuring property investments within a pension, self-invested and self-administered pension experts, and are regulated by HMRC to administer UK pensions, but Simon thank you, for joining today.

Pensions could be quite a bit of a minefield at SSAS’s and SIPPs, yes, we’re gonna touch on that in a second, but tell us a little bit more about yourself first.

Simon
Yeah. Well, listen, thanks,  for coming over Rob, and,  inviting me to speak,  yeah, but again to my background, I’ve been in financial services for nigh on 30 years,  dealing with investments,  and pensions, both in the UK, and the Middle East, so I came back from the Middle East,  three years ago, and you know I was looking at something different that I could help clients with, with regards to investments, because I’ll be honest, and I as I said well a lot of people I speak to, property investors were the bane of my life, when I was speaking to them about stocks, and shares, investments, and equities, you know, they, Simon that’s great, but property is our investment, which, you know, definitely away, away from, because,  property investors, very passionate people, and, you know, they’ve seen some great returns from property both yields and, and capital growth.

And,  when I was approached by The Landlord’s Pension, and they opened my eyes to a definite way of helping clients, and that was to let them take control of their existing and frozen pension funds, and investment of property, it was really exciting for me, something completely different, so, yeah, I mean, that’s my background as I said,  investments, and helping people create wealth,   for, for 30 years, it’s just that we’re doing that in a really,  far more interest, and sort of exciting way.

Robert:
Oh, for the for the benefit of people listening, some people are gonna be listening to this, have,  already got their,  pensions and SSASs sorted, some people are gonna be listening to this thinking, “I literally have no idea what you’re talking about.” So, just for people that might not know, what is, a SSAS?

Simon:
Yeah,  well, so a, a SSAS, Small Self-Administered Scheme pension is, is basically a director’s pension, okay? It’s designed for, company directors, which more and more profit investors are, are becoming,  on the advice of their accountants, and, and as a pension wrapper, or if somebody had a pension from their corporate world, or frozen pension, or existing pension from one of their,  employers previously, or private pension, they can actually get control of that, and that’s a really important thing, that’s one word I use quite a lot, is control.

They can actually use those funds,  a SSAS, what we call pension wrapper,  and use it to invest in property in one way, way, shape or form. So, it’s, it’s all about the choice, the flexibility, and the, and the control as I say.

Robert:
So, and you say to invest in, in property to Hall Ward, if someone was to set up,  a SSAS, then how would they then go about using that to invest in property? What sort of properties can they invest in what, what things can’t they invest in?

Simon:
Okay. So, I mean with regards to the process if you like, I mean we are here to help people,  establish,  the scheme, get HMRC registration, which is really important,  and then from then on, it’s, it’s really because the member, the individual, their trustee of their scheme, that’s what gives them that tournament. Now with regards to, what you can do going forward, you can buy commercial property with a SSAS pension scheme directly with your scheme, okay?

So, if you have a pot,  for reason £200,000 and a SSAS,  pension scheme, you can go out and buy a property, a commercial property such as an office,  care home, pub, whatever it may be,  directly with your pension fund, so your pension fund owns the property, the commercial rent as they impede back into the  pension scheme, so it’s all about growing your pension, a very tax-efficient way of,  buying a property, and you know you can now actually leverage up to 50% of your fund from that scenario, £200,000 and a pension fund, you could go out and buy,  an office suite for £300,000 the rent goes back into your pension, it’s blown in a tax free environment, really important,  and on disposal, so when you decide to retire, and if you want to sell that,  office for example, and there is no capital gains tax to pay, so you know if, if that’s a reasonable value, then your pot, which you’re gonna get an income from, has grown substantially in a tax free environment.

So, that’s just one sort of element, you, a lot of the property investors that we deal with are, are, are residential investors. Now, you can actually make a loan from your pension fund to your company, as I said, you’ve got to be a company director. We have,  a website,  an eligibility test to see whether you qualify for the SSAS pension scheme, recommend people obviously do that,  before making an inquiry, and we also have a guide on there that, that tells you what you can do. So, as I said, with regard to the residential property, you can make the loan to your company, your company is a property development company, you’re gonna go and buy residential property. That is all within the HMRC rules, okay? So, you’re not breaching any HMRC rules, which is obviously very important.

So there are set limits, 50% of the funds, so using that £200,000 as a case if you like, then you could lend your company £100,000 you can go and buy a residential property with that fund, the loan repayment goes back into your own pension fund, if you look at that as a form of bridging, you’re bridging yourself in a really tax-efficient way, then and you,  you obviously are paying yourself back, and growing your pension fund a- at the same time, what’s, what’s not to like?

Robert:
And just ta- just, so just touching on  the eligibility calculator and the guide,  there’ll be links in the show notes on that as well, so for anyone thinking, “Cool, I wanna go and check that out.” There’ll be links in the show notes, so go and check that out for yourself.

Simon:
Great stuff. So, yeah, so that’s,  that’s another element, you can make unconnected third-party loans, so if you’ve got a,   sort of,  an individual who’s looking to raise funds, and as a good deal, you can make a, an unconnected third-party loan,  with a fixed return of interest, or share of equity even,  and we deal a lot, and this is where I sort of,  have invested myself, I have a SSAS myself, and we deal a lot with property bonds, which are basically loans to large property developers, with multiple projects, and they offer fixed returns over fixed terms, and you also have a legal charge security of the asset, so you’ve got that type of security.

Now going back to my previous life, my corporate life,  I, I had, I,  pensions that had a,  a mass through,  banks, and, and investment companies are bought for, I actually consolidated all of those into a SSAS pension wrapper, and my chosen strategy was,   completely hands-off,  as I said, I, I was an IFA, I got glass back and soft hands, this co- comes with the territory,  but, I later return but I didn’t really want to put the hard work in,  and, and, and all the dealings with the agents, and, and management companies, and so on, so I looked up at,  a number of property bonds, all I wanted to do was grow that pension, but with a fixed returns, I knew exactly where it was gonna be, at 10 points.

So, when I,  reach 55, then you know I can make a decision, do I wanna continue to invest, and do I wanna retire, or, or, or take a lump sum of money from, from my pension scheme,  and,  that gives me that, that facility,  because I know exactly what’s, what, what, what my pour is gonna be, and with the added security, something I never had with equities, with all the security there, then you know that gives me a lot about peace of mind as well,  ultimately if the equities are a little investor in, if they’ve gone through the herp, there’s no way that I would be getting any, any funds back, because the share value would be zero, whereas, with the security with property, a tangible asset is there, I’ll always have a value, so really important for me.

Robert:
The security you mentioned in terms of a, a legal charge,  are we talking the first charge, the second charge?

Simon:
 We have various different, charges, generally we have a first charge on the assets of the developer, and there were various different property bonds, and it all depends on the client why it’s really important to have those conversations, and about what, what exactly, a client would want to do and want to achieve from there, and you know from there SSAS pension scheme,  and this is where we come into play obviously, we deal with a number of different administrators, there are,  talent for the individual client, and what they want to achieve,  both dot, medium and long term.

Robert:
I think it’s absolutely incredible, people might be listening to this thinking, “Well, that just sounds too good to be true.” I mean we’re talking about,  no capital gains, tax, it’s, it’s incredibly tax-efficient what you can do with a SSAS is that a common stumbling block that you get with people when people are starting to speak to you about SSAS, is it they just think that this sounds too good to be true?

Simon:
Yeah. I mean it’s, it’s one of those things where people look at their traditional pension schemes, and because they’ve been offered very little, and the way of both returns and security,  when they’re offered something that,  offers security, and offers you know good fixed returns, then,  it, it does seem too good to be true, because,  it, it’s what people are used to they’re offered nothing really,  apart from a piece of paper, and a promise, with your traditional pension schemes.

Now,  when you equate that to property, and, and you speak to property investors, and if you said to a property investor, “Look, you can get a 9% return,  over a five-year term, and security that,  over a tangible asset.” That makes them too good to be true, but then when you’re actually asked, “What are you doing yourself? What kind of returns have you had both act, or, appreciation and rental yield?” Then the vast majority are gonna say, “Well, we get more than that.” So is it really too good to be true? All you’re doing is, is moving the emphasis, and moving the investment type from,  as I said, a piece of paper, a promise, a share certificate,  tangible asset that most people,  sort of know, and understand, and like, so is it too good to be true? No.

We’re living proof of that, we’ve been,  doing this for 15 years at The Landlord’s Pension, and, and 100% of our clients have seen the returns that they were promised every single year, year-on-year, during that time.

Robert:
And I think that’s absolutely fantastic, I just wanna point out, although I’m not suggesting that it is too good to be true,   far from it, once you’re, property is one of those, one of those great things, once you’re really involved and you, you start learning about different ways of doing things, you, you start to realize that, that,  anything and everything is achievable, so you know just for the benefit of people that might be listening to this, thinking, “Oh well, it does sound too PR.”

Its really nice about who what and if you do have that knowledge, and work with people like yourself, some that have that knowledge,  your life could be I say it a bit easy, I mean that quite flippantly. So, it just is, just so much information out there, it’s incredible.

Simon:
Yeah, absolutely, and,  going back,  sort of, I’m, I’m, I’m grey enough to remember when somebody would buy a four-bedroomed property,  and put a family in where there could be one person paying the rent, somebody came up with an idea of an HMO, and long behold, we, we were, were increasing the yields, then you know it’s really just a, a transition from what, and the norm to something which is  gone especially when you’re in control of it as well, and something which you can drive, and you can make,  bigger and, and better choices on, and you know if you can do that in property, which you won’t be able to do without a traditional pension, why not?

Robert:
Yeah, that’s definitely one of the big advantages of, of having a SSAS, and again with the securities well thought, you’ve got a first charge,  and, though it seems that people did arrange due diligence on different projects, deals, companies, et cetera, but once you’ve got the first charge in there as well, as you say, if anything does go, Pete Tong used to cut me right in his slang he said wrong, then you’re gonna have the asset anyway, so what we say is pretty much, I mean with the situation, but you get where I’m coming from, from is, you’re gonna get, be in control of the asset one way or another.

Simon:
Absolutely, and, as I say, if, I always use the analogy with, if you were invested in, in British home stores, toys, or Australian, and your shear went to zero, if you could go back to those companies and say, “Look, I know you have assets, so rather me losing out completely, why don’t I take, take those as a value, and then,  at, at least pick up some of my funds?” You, you’re not allowed to do that, but you know we- when you’ve got a charge on a physical asset,  you, you can do that.

It’s really important as you said about the due diligence, I would recommend that anybody do their due diligence on,  our company, on any of the investments that we deal with, or indeed,  any investment that they’re gonna make, due diligence is absolutely,  completely important, and it should always be done.

Robert:
100% on any deal, on anything, anyone that you speak to do due diligence,  is important. Simon, in terms of, eligibility, you mentioned that you need to be company director, is there a certain amount that you would need to start office at, is there like a recommended amount, or can you start off with like tenure?

Simon:
Yeah. So, I meanthe, the vast majority of our clients,  what we would see as £50,000 and pension funds, would be a minim because obviously there are,  of course involve a set up, and annual administration,  fees, and so on, and, and to make it viable financially for, for a client, and it’s not us being greedy,  it’s gotta be right for the individual, and then £50,000 and that could be five pensions for £10,000 each that you can actually pull together and consolidate,  or,  one pension with £50,000 on it, whatever it may be.

You do have to be a company director, so you do have to be a director of your unlimited company, and the other thing with regards to the size of fund or funds, as you don’t have to be doing this on your own, so if, if your husband, wife, partner, and business partner, whatever it may be, you can actually build pensions together, and consolidated laws and a SSAS wrapper, so if your husband and wife team with a business partner, the three of you can actually ha- pull pensions together, and one’s got 100, and one’s got 200, one’s got 300, there are £600,000 in a pot, which you can utilize to draw, start, expand, or accelerate your property business,  and,  each individual’s, individual con- contribution is ring fenced, so you will get your proportion when the returns come in, so, you’re not putting anything at rest by doing that.

Robert:
For example if,  my brother and for example got,  a sort of trust fund that’s gonna be passed down at some point in due course, so effectively what you’re saying is, if we, if we’ve got that, and we’ve got an amount there, then if we were to create,  a limited company between myself and him, we could effectively create a SSAS out of thin air, and just start using that too, that invest in a property?

Simon:
Yeah. So the limited company has to be a legitimate limited company, so you know it gotta be trading, or have the intention to trade, because, but not everybody has got three, four, or five years of account, so a lot of, property investors, they’re on, on their base of accountants are,  going forward, buying an unlimited company, so it should only have the intention to trade, and, or you’re a, a legitimate trading company, then those funds that, that you, you can, you can bring in to the SSAS pension wrapper, that could be from an existing pension, it could be cash from your company, you’ve got personal contributions you can make, the other thing with the SSAS is, you’re not limited to those personal contributions, you can make company contributions.

So if you’ve got a, a corporation tax liability looming and your accountant is saying like you need to,  sort of do something with, with these funds, you could put that in as a company contribution to the SSAS, and utilize it to invest in property.

Robert:
Is putting money into your pension possible, or is it at the top of expense …

Simon:
Absolutely

Robert:
… as well we should, not many people realize they probably do now after they sell it, well which is, which is really good though, and it’s amazing what you can actually do once again, once you get into the nooks and crannies, we’re not just necessarily talking about,  going in, buy property, renovate property, refer property,  refinance, of course that’s, for a lot of people that said, when they’re realizing these sort of profits, it’s how to be strategically moving forward, almost,  looks like creating legacy as such, but it’s a snowball effect, isn’t it?

Once you start doing it, and it just builds up, and build up, and build up, and say utilizing,  SSAS working with someone like myself is gonna be a great way of being able to, well get your money working harder for you, rather than you working harder for your money.

Simon:
Yeah, absolutely, you mentioned legacy there, now a lot of our clients,  various different types of pension, personal pension, company pension, final salary define benefit pensions. A lot of people are looking at those, these are the gold-plated pensions, where you’re gonna get X amount of money every month, and,  guaranteed when you retire, and a lot of people are looking at those and thinking, “Well, actually,  there’s a, a transfer value to that.” And if that transfer value has you know £500,000 you’ve gotta weigh that up against, well I’ve got a transfer value, a pot of money basically of £500,000 which is gonna give me maybe £15,000 a year when I retire, when I die, or get my,  partner, or double partner, wife, spouse, 50% of that, and then it dies with me, okay?

The question you need to ask, is well actually,  can I take £500,000 today, and you can,  you can set up a SSAS at any age, so you, you don’t have to be 55, you’re 40 years old, and you’ve got a, a, a pension fund you can, you could actually,  transfer that into a SSAS pension scheme, and start investing today. So as I said, the,  £500,000 would you be able to utilize that, and get a greater value than £15,000 down the line? And the other thing, as you mentioned about the legacy, it doesn’t die with you, that’s always a pot of money, so you’ll have a, an expression of wishes as we call it, just you nominate your beneficiaries so that,  God forbid, anything happens to you, then you have created that legacy. So, really, really important for some people with final salary pensions.

Robert:
Does that impact inheritance tax at all?

Simon:
It doesn’t. The SSAS pension or any pension scheme is a trust, which is held outside of your state, okay? So, it, it doesn’t come into the inheritance tax, and you know sort of liability.  there are certain rules if you’re over 75,  tax rules, which could impact on that, having said that, if you have a pot of money there, and you know you’re over 75, and you’ve been retired for 20 years, well,  whoever, whoever’s gonna inherit it, and, and pay some tax on it, that’s not gonna be a huge gesture.

Robert:
In terms of differences between SSASs and SIPPs, cause people, some people might be familiar of what a SIPP is, but not SSASs and vice-versa, so can you just go into a little bit more about what the fundamental differences are between the two please?

Simon:
Okay. So,   SIPP, a Self-Invested Personal Pension, and I’ll be honest, you may as well strike the S-I off of it, cause a personal pension most people don’t actually self-invest, they don’t self-invest in a personal pension, they leave it to the bank, or the investment, or insurance company.  The SIPPs are more restrictive with regards to where you can invest, so you don’t have that flexibility,  and to be honest, they’re getting more and more restrictive SIPP providers as to what they will and won’t allow you to do, and you can’t buy a commercial property with the majority of SIPP providers, but not all,  and,  generally you’re investing in equities.

With a, with a SSAS, and if you’re a company director, I’ll be on, I, I would have a SSAS all day long, because,  if you’re eligible for it,  the SSAS will give you a, I’ll, I’ll lay it down from the set pump. So you can invest in equities, and you, you can buy commercial property, but also what it does, and I’ll go back to that word control again, it gives you control over your money, this is money that you’ve invested, that you’ve worked for, why should you leave that to a fund manager, or an insurance company to, to provide you with your income in retirement.

You can take control of that, you’ve got far more flexibility with a SSAS, you can do the loan, as I said, start, accelerate, or,  grow your, your property business, and you could buy investment, great goal building if you still wish, and you know it, it, it just gives you so much more flexibility,  choice, and control over your funds.

Robert:
In control, such an important well as, and speaking to Mark Smith of Cotswold barristers,  recently based up in Cheltenham, and the, the point that we touched upon is,  you are, effectively you are the CEO of your own company, so you might as well be the CEO of your own money, you might as well have that control, and utilize you know fantastic people around you, with knowledge, to be able to, to make your money work harder for you, you are in control at the end, and that’s how it should be.

Simon:
Absolutely, but again,  if you go back to how things have been traditionally done, nobody wants to tell you that, why would  an IFA or a fund manager say, “Look,  we had given you a return of after fees, be it percent a year, or whatever it may be, and, but why don’t you take control of your money, and we’ll cut ourselves out of the equation.” It’s never gonna happen.

But more and more people are, are, are aware of the opportunity, but,  be fair, a SSAS pension scheme is an opportunity for you to use your funds in a way that you see fit, and that,   you understand a new light and enjoy, rather than leaving it for something who you’ve never met basically, to determine your, your, your, your retirement income in your future. That was a bit deep, wasn’t it? (laughs).

Robert:
It’s what, as a podcast, we love exploring, as much content as possible, and you know there’s really no holds barred on, on the Property Nomad’s Podcast is, you’re probably familiar with we gotta shove it out. Common things that people might,  come to obviously, we mentioned about the eligibility calculator, again the link’s gonna be in the show notes to that, what common questions that you hear from people they might have passed the eligibility calculator sort of test, and I read your guide, what sort of common questions do you get day-in day-out from people that might not be as experienced in property as others?

Simon:
Yeah. So, one of the things with age some people will look out and say, “When I’m 55, I’m gonna do that, because it’s a great idea.” As I mentioned before, you, you, you can actually take control of your pension at any age, you don’t have to be 55, 55 is a time when you can take a 25% tax-free lump s okay, or, or, or an income, but to actually grow it, to actually invest it, you can be any age, that’s one thing that, that, that we’re often asked.

And the other thing that,  comes up quite regularly, is,   I can only invest in, in commercial property with a SSAS, because they’ve got the SIPP element in their head, and now when it comes to commercial property and pensions, it’s really important to, to know that commercial property, and a pension, is as deemed by HMRC, so a lot of people say, “Great, I run an HMO business, as a commercial entity, I get commercial lending, therefore the HMO is commercial.” Not the case.

So, HMOs, there is accommodation, student-let, unless they’re directly connected to the university,  and holiday lets are deemed as residential, they’re not commercial, so you can’t buy them directly with your SSAS pensions, and easily if, if you look it has, if the property has been a residential property, or could quite easily be levied on as a residential property, according to HMRC, it’s residential. Having said that, you’re looking at that type of, business, then there’s a loan facility, because remember you’re loaning, making a loan from your pension fund here age, or bank account, in your company’s bank account, and if your company’s buying residential property, exactly what you’re gonna go and do with it.

Robert:
It sounds so incredibly tax efficient, it’s brilliant.

In terms of mixed youth unit sense, so we’ve obviously touched on HMRC, deem, X, why is that residential, and we touched on a commercial aspect awfully buying pubs and so forth, so where does a shop with a flat above it, where does that sit in terms of investability?

Simon:
Yeah, so, I mean, and that’s now, and again, we have a lot of conversations with other, about, about shop and talk, what you’re looking out there is splitting the title, okay? So your pension could directly purchase the commercial asset on the ground floor let, say, and as long as it, the, the title split, there’s, there’s separate access to the residential above, you could then do a loan to your company, and buy the residential above.

Robert
Does the title have to be split before purchase?

Simon:
Yeah, or up on purchase.

Robert:
Okay, so is that aspect of investing is, is achievable through us as well, which is good?

Simon:
Absolutely and we’ve got lots of clients that do that.

Robert:
In terms of what makes The Landlord’s Pension different, cause I’d be, people that might be familiar with going to various,  event, people you know a few people speaking about pensions here, pensions there, SSASs here, SSASs there, what makes yourselves different from anyone else?

Simon:
Right. So, I mean there are a few,  organizations if you like, out there that,  speak about SSAS pensions, and as they get more popular, in my opinion it gets a little bit more dangerous, there’s a lot of misinformation out there, The Landlord’s Pension then, there’s a couple of things that we, oh, myself as I said, I’ve got 30 years’ experience, in investments, and pensions, there’s a whole wealth of experience in our organization,  not just on pensions and investments, but also on property investment, and though my colleagues,  have dealt with it and continue to deal,  on a regular basis, building our property portfolios, and, and, and that’s rare across the board,  you build commercial, residential, and the bottom shop is,  as we mentioned previously.

Though, when you’ve got,  dozens and dozens of years of experience right across the board, and obviously the experience of all of our clients, and there’s a huge amount of knowledge there, and I would challenge anybody to, to,  sort of come up with a scenario that we’ve not come across, that would be it basically.

Robert:
In terms of, I wanna say what you just touched upon there is,  it is important to,  restate that, if anything in life, you listen to this thinking, “Yeah, it’s great, let’s get started.” Do your own due diligence on anything,  whether it’s, pension providers, different property,  purchases as well, you’re gonna have to do your own homework on, on it, and that’s important to reiterate.

There’s, we mentioned that so many pluses on,  SSASs and so forth, in terms of drawbacks, or, or negatives as such, I mean I’m ta- I’m stopping to think of any here, it sounds like it’s, oh, it, it just sounds a 100% positive, it’s, it’s really, apart from possible, I can imagine someone going bust, obviously that’s gonna be a drawback, but again if you do your own homework, you’re kind of gonna know if that’s gonna happen, or not really, are there any negatives from your point of view, any disadvantages of people,  realistically need to be thinking about?

Simon:
We do a lot of due diligence of sales on any sort of any investments that we deal with,  and you know it’s on the individuals, it’s on the company, it’s on the track record, and, and we don’t,  sort of speak to anyone about,  any investment until we have done our own due diligence, we get dozens of,   companies phone us and say, “Look,  you’ve got lots of clients, you have,  you’re, you’re very well known, very well respected, and, and so on, and we’ve got deals here that we’d like finance.”

We tell them there was a way,  on, on a daily basis, because as I said before, we have 100% track record of our clients making money, or has, has agreed to house there,  and, were not, were not gonna throw that away, and the drawbacks,  at the end of the day, risk, there’s risk in everything, as you say, a developer can go bust, and you know with our security, then you know you’ve got that bit of peace of mind there,  and as property, they’ll always have a value, and  everybody’s you know so concept to risk is different, some people say, “Well,  stocks and shares is high risk.”

 The FCA for example, which is another sort of thing that you know I’ll touch on in a second, and as, as a potential drawback, and they would say the property’s high-risk, used to be the property investor those, they would say, “Oh no, equity is high risk.” Property, I’ve always made money,  it’s always had a value, at least, and the one thing that, and, and to be honest with you, it’s more IFAs that tell clients if,  we’ve got a, a person that we are speaking to, and they speak to an IFA, they say, “Oh, SSAS pension scheme’s unregulated.”  the truth of matter is,  HMRC and the Pensions Regulator are, are the two people that regulate, SSAS pension wrapper, SSAS pension schemes, and I think they’ve got bigger teeth than the FCA.

What you got to remember is the FCA are regulators that regulate,  equities and regulate the banks, that doesn’t work out too well for them, so when it comes to,  when it comes to,  a negative, that’s what the IFA is, or then they say is what will, will bring up and regulate, it’s not the case as it’s just not regulated by FCA, but,  perfectly comes with it.

Robert:
Yes, what was, I think what’s revolved in bricks, and what was, what was, you’re gonna be fully aware of,  the potential downfalls, and,  it all depends on the, it all depends on the people do, they’ll, as you say, you’ve got a great track record on The Landlord’s Pension, you’ve got a fantastic track record, so,  the ask of anything caveat, and do a bit of work, do your homework, and,  it should see you through, or that should offset at least, you don’t have any drawbacks.

Simon:
I mean property investment isn’t,  regulated by anybody,  anyone can walk into an estate agent and buy a property as an investment, so you know you said it, it’s all about doing your homework.

Robert:
In terms of cost of setting, such a thing up,  obviously time’s changing, and I’m sure that,  numbers will change in due course as well, but as it stands at present, what are the rough cost of setting it up, and, and then continuous administration of SSASs?

Simon:
Yeah. We deal with a number of different administrators, depending on you know what an individual is, is looking to do, but typically a one-off initial setup fee of, of two and half thousand plus VAT, and, and that could be paid from the company as a company expense, it could be paid from the pension fund on transfer, which is money you can’t access anyway, and you know we can take that money out, and, and as I said, that has a, a one-off initial fee, and depending on what you do with,  and how you work your, your, your SSAS,   depends on the annual administration,  plus.

Typically, if you were to establish a SSAS pension scheme, make a loan to your company, because you know at the end of the day,  we’re all in business, everybody’s gonna get paid for,  everything we do, and you know to make a loan to your business, put some funds on a property bond for example,  hands off to be taking over in a background, and, and, and make an unconnected four-party loan, so if, if you’re doing those things,  1,000 plus back, 1,200 plus back, and these are all flat fees, but it doesn’t matter how much your pension grows by, these are all flat fees, so it’s not a percentage of funds like it would be in a, a traditional equity based pension, where they’ll be charging you anything from half a percent to 1.75% of the fund, they make more money.

Well, if you make more money, they make more money, if you lose money, they still make money, just not as much, which is cool comfort, as I said, flat fees, and when you look at the returns, as I said, if, if you’re looking at 10% and you get a, a, a year, and you’ve invested,  £100,000 and you know to, to be a £1,000 build privilege of that.

Robert:
Good, good,  good investment, it’s a lasting way to look at it’s not the cost of doing something, it’s seeing the investment in doing something, so if you’re gonna invest all the £1,500 title,  and you’re gonna,  make £20,000 at the end of it, that’s not bad, I don’t know if you ask me.

Simon:
Yeah. I mean it’s the cost of not doing that  has more impact,   leave it where it has, and you know to get, you get what you’re gonna get, and if markets crash the, of a week before you’re,  due to retire, then not gonna happen.

Robert:
Yeah, or you can just legislation erode it away over the course of time, which is no, not a good thing, which is scary actually thinking about, I don’t think many people realize that,  relations almost like the ultimate tax, not the silent tax, people just don’t realize it.

In terms of, in terms of returns, and a- again I can imagine it’s gonna be dependent on each deal with so forth, on average, what other clients of The Landlord’s Pensions seen a rough percentage of return payer?

Simon:
On average, I would say 10% per annum tax returns, and it all depends on you know where you’re looking to invest,  and the term that you’re looking to invest in, but typically it’s between 7% fixed return plan to 12% fixed,  return plan, and though if you, if you look at 10% on an average, then that’s where we are, and that’s why our clients have really joined them for last 15 years, and you’ve got to look at the alternatives, that’s what you can, in a SSAS pension,  you’re making a loan to your company, then you know that’s over to you how much profit you’re gonna be making.

Again, come back to the control, and being master or mistress of your own destiny,  that’s your choice, and, but yeah, I mean if you look at you know what you’ll be getting from, the returns of a traditional scheme, or where it may be sad at the moment,  on average over the last 20 years on the Hargreaves Lansdown, the 50, 100 is the return fee percent net, so over to you and there are lots of those, and their choice really.

Robert:
Wow! I didn’t realize it was, that low.

Simon:
That comes from their own website as well, it’s not just me plucking numbers out of there.

Robert:
Wow! Now, hat’s off, and as you say it’s really about what  you know and you know a SSAS, I can’t say cause I’m not,  FCA or,  an IFA or anything like that but again the important thing is that,  this, this stuff works, I’m 100% this stuff does work, and,  it’s about speaking to the right people, learning the right things, and it touches upon,  a recent episode,  it is effectively, it’s strategic tax, I don’t know, it’s just strategic planning. You can do that work with the right people, the world is your roster.

Simon:
Yeah. I mean, as you said,  what you know and who  I mean at the end of the day, yeah you’ve gotta work with the right people, which obviously we believe we are,  but, if you have got that knowledge, and it’s, I’m old school, I draw pictures and I sort of explain things in simple terms, because that’s the way I would want it explained to me, it’s not me insulting anybody’s intelligence, it’s just that,  if you can lay it down in layman’s terms,  then you know people will have that knowledge, and, and they can make an informed decision, that’s what it’s all about.

I mean, we don’t work with everybody that you know we, we potentially could, and,  we are quite selective as to,  the, the clients that we work with, and it, it’s got to be right for them, and, and they’ve got to have the right plan if you like, and if they have that knowledge, they, and they can make an informed decision on it, then everybody is better off.

Robert:
And just before we wrap up, I have a quick fire round then, so the, the process of what you say is people are listening to this, people that might already have pensions, that might be thinking of,  changing them across, etc, is go check out the,  eligibility, go check-up what you can, link will be in the show notes, then should they pass that, and then,  read the guide again, link in the show notes,  then from there, the next day you need to contact yourselves, pick up the phone, have a chat, and then you go from there.

Simon:
Absolutely,  at the end of the day, if you, as you mentioned, go onto the way of saying, you’ve got the eligibility  test, you’ve got the the SSAS guide to, to give you an overview, but for you as an individual, and, and, and your circumstances, and what you’re looking to achieve, which may be different from the person next to you, it’s really important to have that conversation.

The processes, we have the conversation, and either we meet,  from there face-to-face offers, the meeting, and you know just to say,  “Look, this is, this is where you are now, and, and, and where you want to be, and here’s a way to get you there.” From there, as I said,  we’re there every step of the way,  and after, because I’ve got lots of clients who, who say, “Look, I’m thinking of doing this,  time to roll over.” As I said, we’ve got a wealth of experience in both pensions and property within The Landlord’s Pension, and there’s nothing that somebody here hasn’t done, it’s an ongoing,  relationship with our clients, it’s not a matter of we set this up, thanks very much, it really is a journey.

We’re there for the long haul, at the end of the day, so that’s the national process, and,  absolutely,  send us an email, give us a call, and we’ll be more than happy to, to help if we can.

Robert:
Yeah. I was, just to resonate on that, properties of people business at the end of day, so it is about working with whichever, it is about those long-term relationships, so completely do you understand where you’re coming from? I’m putting the links for the show notes for the calculator and so forth, contact details, the website as well,  again that will all be in the show notes, onto quickfire now, hold my hands up, I didn’t come up with these questions, but, however, they normally provoke the best responses from people, so bear with me on this one. A couple of quick fire questions to wrap it up, what would be the one piece of advice you would give someone that is in limbo over making a decision?

Simon:
I would say go with your gut instinct, but for me, you regret the decisions you don’t make more than the ones you that, so if you, if you’re in limbo,  yeah take advice, speak to people, people that,  may have been in the same position, ultimately if you like, if you like the person you’re dealing with, go with your guns don’t, make a decision.

Robert:
What’s the worst piece of advice you’ve ever been given?

Simon:
Invest in cryptocurrency. It, it probably wasn’t the worst piece of advice I was given, but I was given at the worst time. Oh, and buy low sell high.

Robert:
Might take a while for them to crystallize in, that’s okay.

Simon:
Yeah, I’ve not lost any money, but you know listen, in the year 2019 I will probably be okay, I’ll probably break even.

Robert:
Yeah, I, well,  SSAS mass market stock was full I think cause you know you and I would understand, and the, so a lot of the listeners understand the property,  the, the rough 18 years suffered at risk, crypto is a very, very new market, it’s such a normal who really knows where it’s gonna go, but,  point, point, point taken, paradoxically what would be the best piece of advice that you’ve ever been given?

Simon:
The best piece of advice, be honest. Now, I know it’s not monetary advice, but potentially could be, the best piece of advice I was ever given is, is,  this was probably from a young age as well, it was honest, be honest with, to yourself, and be honest with other people,  and I, I’ve taken that through, right through, I’ve been fairly successful with regards to my career, and, and the reason for that, I mainly put down the,  sort of that piece of advice, as  don’t, don’t try and, cheat people, don’t lie to people, and, and, and promise something you can’t deliver,  treat someday how you would want to be treated,  and,  do unto others if you like is, is, you would love done unto you. So, be honest and, and be straight, also I, like I’m at that age where I can’t remember things, you’ve got to have a good memory to bear lie on you.

Robert:
The last question to wrap up, and in the last three years,  what belief, habit, or behaviours have the most positive impact on your life?

Simon:
For me, it’s a to-do list, I, it’s something I never did, cause I was very sort of yeah get in there and, and,  take it as it comes,  because I don’t like per se, I’m not that sort of person, I’m a people person, I don’t like processes, and you know systems, and I know I’ve mentioned to you, I’m a complete lobby, I don’t get technology, so, but yeah, a to-do list, absolutely fine, and, but I never used that  until,  sort of you know I’d, I’d say in the last sort of four or five years,  because it worked really well at home, my wife used to give me a to-do list, she puts a post, on with a to-do list, and I take off as I go of all the jobs I have to do.

Robert:
Simon that’s absolutely fantastic, if people do, they want to check out the website in the meantime, obviously the link will be in the show note, but obviously people might be driving and so forth, so,  how do people get a hold of you, how do people get a hold of The Landlord’s Pension?

Simon:
Yeah. So, I mean, l- look, I, my email address is Simon@thelandlordspension.co.uk, and the, the website is thelandlordspension.co.uk,  it’s thelandlordspension.co.uk,  and you know we also feature in YPN, Your Property Network, and, and Property Investors News,  and you know look, there’s a, we have case studies, so it gives people about more of an idea as well, and there’s a website, testimonials, which according to my tech savvy people, we can’t do anything about,  these are absolutely genuine, and you know  we can’t doctor them unfortunately,  luckily it’s all five-star, so it’s all good, so yeah, have a look on the website, drop me an email,  and,  if we can help as I said, cell phone any of my colleagues, they’ll be more than happy to.

Robert:
Well it was absolutely fantastic,  thanks very much for your time, I really enjoyed that.

Simon:
Thanks very much for coming over Rob, and,  yeah, been, been great being part of the,  Property Nomads.

Robert:
For all of you listening, that wraps up the mini-series on successful people and property, hope there’s a lot of fantastic content you’ve taken out from that,  keep wise,  well the next few weeks Matt’s doing a mini-series on successful business people, there’s gonna be absolutely fantastic interviews lined up on that, and just as a reminder,  my book is out on Wednesday the 10th of July,  working title, haven’t quite figured out what it is yet, but it’s all about buying,  buying and selling property, but hopefully that mini-series has been absolutely fantastic value to stay of, keep listening, go and check out The Landlord’s Pension, go speak to Simon, you’ve got a big pot of money there, or you don’t know what to do with it, or you’re struggling to think what to do with it, yeah go, go check him out, and,   get that money working for you, rather than you working for the money. Till next time, all the best.

Download the free SSAS guide featured in this podcast:
thelandlordspension.co.uk/propertynomad

Find out if you’re qualified for a SSAS:
thelandlordspension.co.uk/test-simon-king

Talk to Simon King:
thelandlordspension.co.uk/talk-to-simon-king

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