Changing the world by managing your pension


09-07-2020
dandelion clocks

Jeremy Edwards, Independent Financial Adviser from Martin-Redman Partners, talks about the benefits of investing your pension in companies whose practices and values align with your own environmental or ethical beliefs. 

There is reportedly £3trillion tied up in pension investments, but apparently only 5% of people have made any alterations to how their funds are invested. By default, fund managers will chase returns and pay little attention to other factors, although there now seems to be more interest in the idea of sustainability. 

People talk about “ethical” investment; but do not always make the connection between their pension funds and investment, leaving their pension to the default funds but taking a more active interest in their ISA or personal shareholdings. 

As an Independent Financial Adviser (IFA), I am very interested in “joined-up” thinking; these days with modern investment products it is straightforward to have the same portfolios in pensions, ISAs, bonds or general investments. It is also quite straightforward to have a sustainable slant to your investments, once you have isolated what you are trying to achieve and what investments are not acceptable to you. Unfortunately, there are likely to be some compromises along the way as fund managers will try to play to the best paying audience and a truly bespoke portfolio is too expensive for most retail investors. 

Sustainability is often in the eye of the beholder; most traditional “ethical” funds exclude nuclear power, (the bogeyman for the 1960s-2000s green pressure groups), where now it is seen as the great hope for bulk low-carbon electricity. A number of conventional high carbon industries are repurposing themselves for the low-carbon economy, but it will be a long haul, with companies like BP spending huge sums of money, but tiny percentages of turnover, on green technology, like PV generation and EV charging. 

For anyone with a workplace pension, it is worth having a hard look at what you are invested in. If you are in the default fund, although it will be cheap, it probably will not match your attitude to investment risk and it is unlikely to have an ethical or sustainable slant.  

The new campaign, “Make My Money Matter” emphasises both the power of pension money, but also the choices open to investors, that so far, so few have made. According to the campaign, “having a sustainable pension can be 27 times as much impact on reducing your carbon footprint as giving up flying and becoming a vegan combined”. Many pension providers do have an ethical or sustainable fund, but you will have to seek it out and decide whether you are willing to accept any compromises inherent in it. 

For someone starting from scratch, consolidating a number of old schemes,  or just uncertain of how to get to a better place, ask an IFA to find what you want. Some of us have been involved in green issues for many years, I have an environmental science degree from 1984! 

Arrange a meeting to find out how independent financial advice can help you 
Please get in touch with us to arrange an introductory meeting, at our cost. At Martin-Redman Partners we have both male and female advisers who can help you make the most of your money – either by managing your pensions and investments, arranging life cover, and assisting with your financial plan. 

To find out more about how we can help, or if you have any questions about your investments please get in touch by calling us on 01223 792196 or emailing info@martin-redmanpartners.co.uk We look forward to hearing from you. 

 About Martin-Redman Partners   

We are a team of experienced Independent Financial Advisers (IFAs) who can advise on your personal or business financial arrangements. We have been building trusted relationships with clients for many years by articulating clear and tailored recommendations in areas ranging from investments to pensions and retirement planning, to complex estate planning advice.  

We offer expert independent financial advice throughout CambridgeshireLeicestershire, SuffolkEast Anglia and the South East.  Many of our clients are within, or are in the surrounding areas of CambridgeGranthamStamfordBury St EdmundsFrinton on SeaElyPeterboroughHuntingdonCambourneNewmarketSoham and Oundle

The information contained is for guidance only and does not constitute financial advice. It is based on our understanding of UK legislation, whether proposed or in force, and market practice at the time of writing. Levels, bases and reliefs from taxation may be subject to change. Accordingly, no responsibility can be assumed by Martin-Redman Partners its officers or employees, for any loss in connection with the content hereof and any such action or inaction.

 

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