Locals get more access to pensions to buy property
(CNS): Caymanians with private sector pensions can now gain access to more of their funds in order to pay down mortgages, raise deposits to buy a home or land, or pay off strata debts, after an amendment to the National Pensions Act was steered through parliament Thursday. Minister Dwayne Seymour, who has returned to the labour portfolio in the new ‘repackaged’ UPM government, brought the bill based on a successful private member’s motion championed by opposition MP Chris Saunders (BTW).
Seymour said the changes would offer flexibility to people in the current economy to make withdrawals for essential purposes to facilitate “life milestones”. The law increases the maximum amount people can take out to cover the cost of home-related finances up to as much as $100,000. However, those taking cash will be required to increase their monthly contributions, depending on how much they take.
The bill has gone through the drafting and consultation period rapidly in order to make sure it becomes law and is implemented before Christmas.
Given that the bill is designed to help those who are in mortgage arrears or struggling to keep paying increased mortgage and home loans, Chris Saunders asked the banks to waive their repayment penalties. He said that, according to CIMA’s latest reports. the high street banks are making record profits, as is the case for some in challenging times.
Addressing concerns about what some see as the latest raid on pensions, he said this bill was about people securing a roof over their heads for when they are retired. With inflation running as high as it is now, investing pension funds in property was not a bad thing to do, he explained.
Saunders raised his concerns about the long-term problems surrounding the inadequate pension regime, but said that while this may be a short-term fix, it was one some people were desperate for. He accused “too many people not from here” of criticising what MPs were doing to help Caymanians deal with “our own unique challenges”.
Several MPs said they would like to see civil servants also access their pension funds. But the public service pension falls under the deputy governor’s remit and civil servants must petition the governor for access.
The legislation passed unanimously after Saunders made a significant number of amendments during the committee stage.
See the draft bill here and the debate and committee process on CIGTV below.
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Why only private sector pension? CNS can you ask? Civil servants are in the same boat as well they too could use some help pooling together funds to buy a home or to pay off a mortgage.
CNS Note: The public sector pension scheme is governed by the civil service management and is under a different piece of legislation. Government workers must petition the governor to get access to their pensions. Elected officials can do nothing about allowing public sector workers access to their funds a point that was raised in the debate which is linked above.
explain how the Civil Service has a world class pension fund and the private sector doesn’t. Who can we blame for this.
I’m from here, the school I went to (finance major) in the midwest was nationally rated at the time. Take my advice; if you are able then move your money to something more profitable. The pension funds here are ridiculous for negative growth, I know my britcay pension has lost north of 40k over last 15 years some of which I honestly believe must be mismanagement.
The only people that profit from my pension are the ones that manage it. Unfortunately, by law, that isn’t allowed to be me.
100k? Muss be one piece of swamp up East they goin buy.
Inflation is in effect a hidden tax. The money that people have saved is robbed of part of its purchasing power, which is quietly transferred to the government that issues new money.
Truth.
That’s why well-managed pensions will invest in equities and corporate debt for returns greater than the rate of inflation and fees.
What is considered a well managed pension ?
I’m from here and this is a disgraceful vote-buying scam. People in retirement are struggling because of an inadequate pension and you’re saying keep raiding the fund is a good idea. Do something about CUC and you will do more good for us all.
And keep your hands off the public pension fund that you’re eyeing to buy the civil service vote. The fact is that this is not the first time that this is done and I suspect with you lot that this won’t be the last.
You should be allowed to buy CUC shares with your pension. It’s guaranteed returns by CIG!
CUC shares purchased on 28 Feb 2023 cost US$14.65 on 27 Nov 2023 it only value US$11.02. Good time to buy. Buy low – Sell high.
Ordinarily I would agree, however, the pension funds are underperforming, and with very high fees they do not represent a good option for retirement. They are a big part of the problem here. Coupled with very limited options when you do retire of drawing a fixed amount as defined by Government, or buying an expensive annuity where the same companies have a monopoly on what they offer. There are many better options to save, but I do agree that you need to do something other than take money out of a bad option if you have no other forms of saving.
Elections are coming and vote buying using the People’s money to secure a seat seems to be right back in style..
Pension is for when you retire. Don’t touch it till then!
That’s pretty funny 10:28, which high performing plan do you have ? 😂
That’s not the point. What will you live on when you retire?
It absolutely is the point, – by law being forced to contribute to a fund that for the most part loses hand over fist isn’t really a savvy investment, – options 8:16, those contributing need better options.
How about retirement savings? The Pension assets are dead money. Not counting on those at all.
Marine park conch, lobster and wild turtle meat.
There’s a timeline axis where local pension assets are not performing anywhere close to market rates. All they’re doing is juicing up local and international money “managers” twice. Better to have it in a household asset that can be earning a fair untaxed market rate return over time. Private Pensions are not Retirement Savings…that’s a completely different bucket that shouldn’t involve our Banana-grade MPs, though clearly far too many are relying on that as well. The CIG, which exists in a tax haven, shouldn’t be taking on select roles of regulating household planning, esp in industries where they don’t understand, and while so many other social policy chasms flourish.
Pension Funds and Real Estate are portfolio bets. Folks should enjoy the discretion to shift portfolio allocations without penalty when it comes to getting to the finish line best with their own household capital. Cayman’s pension plans are over-billing, which is a huge drag on performance over time. Better if the CIG, who suffer from chronic accountability malaise, stayed completely out of the private household business of the citizenry, to focus on reducing spending waste, increase transparency, and fulfilling their duties to the public.
Good god i hope i leave before they reach pension age they all beholding up gas stations in zimmer frames
This is a very short sighted plan and is doomed to fail in 10-15 years!
Saunders will
Be long gone from politics by then
And that’s the problem with all our previous politicians of the last two decades.
I really wish he wouldn’t wait.
And filthy rich. $305,000 over 15 years is quite a heavy burden on the tax payers with no recourse when the tax payer retires with the exception of NAU!!
If an individual can buy a piece of land, and that is a big if, with all or partially from what is in their pension account, then there is a valid argument to be made that said outright purchase would be a wiser financial decision with far better potential of positive returns than having those funds stuck in an under performing and scandal ridden system of pensions as it exists in the Cayman of today. The pension ‘schemes’ in the Cayman of today is one of those originally good ideas which the road to a metaphorical hell is paved with.
#brettwasright
I guess there will be a lot of trips to Cuba and Honduras now. When the money runs out they will come back poorer than church mouse. Then they will be tearing down the doors of NAU trying to get in with their sad stories. I suggest they all form a line to their Representative door. Or it might be a better idea to camp out on their front lawn.
How much do kc earn?
How Much Does a Queen’s Counsel Earn? Based on their experience and legal expertise, Queen’s Counsel barristers can charge much higher fees than most other legal professionals. A top Queen’s Counsel barrister’s annual salary can easily exceed £1 million.
Um. As you started out, it’s Kings Counsel now and as you say, it is extremely difficult to become a KC, takes many years of excellence.
How naive! LMAO
LOL missed the point!
9:25. What can the Governor do. You got what you elected.
For anyone with any common sense and foresight, what we have here IS poor governance. Governor should be taking preventative measures by stepping in, banging their heads together and giving them a lesson in financial prudence.
Oh yes 4:59, and we Caymanians would just love the idea of an English governor lecturing us brilliant people on anything, right??!! Give me a break. That’s why after years and years of bitching we finally got the British to send us ribbon cutters and people who would stay out of our internal business and let us run things on our own. “We so bright we don’t need them limeys messin’ us around”.
No government minister should be mandating how or what we do with our own earned money. The CIG should be nowhere near regulating private household finance. This is private property that does not belong to them. It’s also a topic so rich with irony, that it might even be funny, if it were not so tragically sad. Perhaps if the CIG could achieve a clean Auditor opinion we could take them seriously about home economics – but that we remain so far from basic transparency and accountability, including mandated and acceptable best practise, makes this determined meddling exercise excessively authoritarian.
Outrageous!
Pension fund withdrawals should also apply to expats. Those pensions are the biggest middle men white collar crime con jobs on island 🏝 with grossly overcharging 3.5% management fee that massively underperforming the S&P500 index funds of Vanguard or Blackrock that charge 0.05% management fee.
What a joke!
There’s nothing noble of those pensions. It’s an incarceration.
There should be FULL disclosure of the salaries of those pension executives and annual profits🐷in every pensioner’s statements as they look at their leeched limp portfolio.
So let me have my pensions so I can put a roof over my head that when I am old I can at least have that…at the rate the pensions are going and their monthly payouts, I won’t be able to buy groceries in 13 years.
Been screaming this for years and my pension is now shit!! Would have been different if I could have invested MY money. Nothing but conceited arrogant thieves and that includes every nember of governnent past and present! Yes, Saunders, spew vitriol and diviseness, you are not above the law either!
I feel your pain!
Here’s a helpful tip … my pension at Britcay has doubled since April 2020 because I amended my pension from their BS limp funds to self directed which I filled out the form to be 70% S&P500 Vanguard ticker symbol VOO and 30% USA gov and corp debt option. I would have done 100% VOO but they won’t allow it beyond 70% of the portfolio 💼.
Don’t get me wrong the fees are still utterly disgraceful by the pensions but at least your money will greatly appreciative in value in VOO self directed fund 👍🏼
Angry old guy lmao
@4:09. Correct- The Vanguard S&P ETF is up over 10% this year.
what a mess we are in these days.
Oh, nooooo…not the Kia Vehicles😊…Kias are cheaper than Jeep Wranglers😜
The only hope this repackaged PACT has it to buy the Civil Service and the poor who have no clue what this will do to their retirement. I hear that people will need to pay it back. Now that is a joke if i ever heard one.
With less money in the pot, the already under performing funds will lose even more. Might as well give everyone their funds to invest themselves. Yeh lots will go for new cars, boats etc. Why invest in local property with sea levels rising?
Saunders has already started with his “too many people not from here” divisive poison.
According to some of his constituents they can hardly get in touch with him. Don’t know who they are going to call when they need a “lil help?”
“Several MPs also said they would like to see civil servants also access their pension funds. But the” majority of Civil Servants thankfully still recognise that doing so will more likely compromise their retirement than secure their present. – There, fixed that paragraph for you.
Keep the politicians away from the Civil Service pension plan. Full stop. No ifs, ands, or buts.
Civil Servants also don’t contribute so why should they have access.
Julianna’s comments, in her closing speech of the Special Session of Parliament, were so effusive in her praise of Alden as Speaker, that proposed for him to be elevated next to the Court of Appeal, the Grand Court or as the GOVERNOR GENERAL.
Isn’t GOVERNOR GENERAL an office that only exists in the context of an independent country? Perhaps Hon. Premier Julianna could now explain whether she now supports the Cayman Islands going independent? We already that Saunders supports independence, so does Julianna now too?
God help us all with this bunch of power-hungry politicians.
Oh dear, by the sound of it neither is he? His “back a yard” attitude is what got him in the pickle he found himself in recently.
Juliana is suffering from lack of oxygen, she will say anything.
She not only washes white governor’s feet!
Bigoted and racist comment there 2:47.
Please refrain from posting.
@1:49pm
Well, all these years we have said the PPM was about power, greed and position. If somebody tells you who they are, believe them! They are like cockroaches, no matter how hard you try to get rid of them they keep coming back..
Some members of the PACT government were so inclined to secure power that they made the likes of Mckeeva, Alden, John John and Julie take over and in the very first day they slap themselves on the back, criticized the voters, made fun of the PACT government, talked about their thirst for power and position and congratulated each other on those positions and made it clear that next position would be Governor General…(are they planning to take us to independence so Alden can get that position too)and to top it off, Julie offered up a little $1500 bribe to keep the largest block in her camp securely behind her and then John John who stills owes his workers thousand of dollars for pension told everyone they could raid their pensions..🙈
You can’t make this stuff up! Only in Cayman!
Governor was stripped of her powers to do anything about this sort of issue by Sir Alden when he was in power for all those years.
Only hope is direct rule.
No, get your stuff and run as young Caymanians are doing before ‘independence’ day comes and Cayman will be left and Jamaica looking like a jewel.
This is a high risk, abominably bad poor governance issue and in this situation the governor has every right to step in. But will she? I’m not holding my breath.
This is why us Caymanians will always be impoverished, because the average Caymanian will think this is a good thing. But my people – it’s not. If you take your pension out, please invest it into something that will give you a good return. (Apartments, mutual funds, etc)
Does anybody else see how financially irresponsible this is? Wow..
Their money their choice.
@9:51 AM – that’s my fear, that it is their choice, and they will choose the wrong thing. 🙁
After listening to the last 8 minutes and 30 seconds of the YouTube video of the Special Meeting it was difficult to listen to the remainder of Parliament, where Julianna kissed Alden’s rear end like one would expect a secret admirer to do and to watch Andre slap the desk top with both hands like a naive little boy was nauseating.
It now appears that the UPM leadership are PPM in UPM or PACT clothing! Can someone please confirm whether Julianna resigned from PPM party when she joined the PACT government?
laughable as usual and the clown show is in full effect….
do these fools even understand what a pension is set up for????
cayman life is like a box of chocolates……
… and left in the Caribbean sun, they start melting fast.
The fun has begun, another wonderful discriminatory comment:
Saunders accused “too many people not from here” of criticising what MPs were doing to help Caymanians deal with “our own unique challenges”.
How do you know those ‘commenting’ are not from here, think all Caymanians agree with you all. Everybody has a right to voice ther opinion.
“Too many people not from here” delivered in a heavy Jamaican accent.
Desperate times call for desperate measures !
and these are some hard financial times for some people , might as well try to save what you have now, think about retirement after many people don’t don’t live to see retirement, we have to plan but looking to far ahead is only another stressor .
#brettwasright
Honorable Seymour, you are a great man. Please stop them take pension and health insurance from mi pay. Also mi want you to eliminate work permit fee for us as we always doing the hard work.
LMAO
Foreigners, even those who have been here a long time. not allowed to do the same thing? Any reason?
Haven’t realised yet…personna non grata…
Yeah, don’t bother teaching them financial responsibility. And then what happens when this generation reaches pension age and they’ve p*ssed it all away on a new Kia. They complain, moan, blame everyone and extend their hand looking for a handout.
Which is when Saunders Kenny, Seymour and Mac, will tell them that Independence is the solution to ridding themselves of these restriction imposed by the UK to keep down Caymanians.
Spot on!
And Cayman goes to the dogs (although it feels we’re well on the way already).
This ÷ $1,500 Civil Servant bonus is blatant vote buying.
The roads full of NEW Motor Vehicles. Some direct me to the Local Bank(s) with the 100% financing, 4-year, low fixed rate and other sweet perks. HURRY! SIGN ME UP.
Personal and financial responsibility- key points here I agree.
Anyone who is truly interested in improving their financial well being would be wise to listen to their podcast regularly.
And then they will come running to “gowment” with hand outstretched for money when they retire and have nothing to live on.
Cayman is already a welfare State. This legislation just compounded it. They’ll be troubling times ahead.
Advice from slimy Chris Saunders is intended to serve his own racist ambitions to divide society into “them and us” camps , setting the stage for Jamaica style garrison politics.
Saunders Is VERY dangerous , and has a sinister self serving agenda to fracture Cayman , and shoo in Jamaica.
and gowment won’t be able to look for England once they have a gowner general.
Well, I found out yesterday that my home insurance has doubled, on last year’s premium.
What is Govt going to do about the insurance industry price gouging that is happening so blatantly?
Home affordability is constantly put of of people’s reach when this happens….and add to that the eye-watering interest rates on loans!
If this continues unabated, people will ultimately leave in larger numbers, due to the brutal cost of living in Cayman. A hollowing out of the middle class could follow, and that spells disaster for any economy.
It’s not price gouging unfortunately. Look at all the natural disasters that have happened of late in the states. It has knock-on effects.
In the ‘states’? Huh?
Yikes. Who’s your insurer?
The days of home insurance in the Cayman Islands are numbered.
Just like in Florida.
Not Gov or really even Cayman’s fault TBH.
Insurance rates have risen massively due to COVID claims. Not like they Cayman insurers book much of this stuff, its all re-insured.
Furthermore, we live in a low lying island that has the potential for major hurricane damage…. higher risk.
We know all of this, we’re not all stupid. They, like supermarkets, CUC, ISPs, retailers, EVERYONE, perpetually gauge prices in the normal course of business. It’s sickening.
Yes, but leave and go where? ?? I am 70 and my health insurance takes up 80% of my income. That is no joke. Thank God for dried beans and rice.
I am nearly done, but I fear for our children. They can’t afford a home, even with both of them working.
I paid my dues many times over, and I am left out hanging in the wind. I wish better for the Caymanians of the future, but somehow I don’t think the current government model will ever address that inequity.
The cost of health insurance is financially killing people 65 and over in the Cayman Islands.
Many older people have left here this year or are planning to leave next year because they can no longer afford health insurance here.
When 70 to 80% of your income goes to pay for health insurance it is time to leave for colder climes.
And change the medical system to wellness and prevention instead of drugs. Much much cheaper and healthier.
30+% increase here after 15% last year on current replacement value. With a remaining mortgage of approximately 20% of the value. Never had a claim in my life yet I’ve paid over $150,000 in premiums over the life of the mortgage…..for what?!
If the banks didn’t demand/require this insurance I would happily self insure. My broker said this year that most insurance companies are not writing new policies.
What is going to happen to all of the new houses going up if owners can’t find insurance? How will the banks deal with this?
There has to be a better solution out there
Pretty sure you don’t need to have insurance once you are below 50% loan to value, at least the bank I’m with doesn’t.
Price gouging in insurance? Government will do the same as it has in dealing with the banks who give savers…even with $500k or more on deposit….utterly pathetic rates while raping the borrower in high interest. All the time saying, “ not my fault, bobo, Federal Reserve blah blah”. The Government will do nothing.
Vote buying season in full swing right now. John John did say he quit because he was worried about his election chances and wasn’t being given funds to spend in his constituency.
Governor just accepts this is the way of life in our backwater Islands.
Leave the Governor out of it for christs sake. She has nothing to do with our own internal crappy goings on. We bitched for years and years at the British to take away all the powers of the Governor so da wha we get.
8:55, So true. Sir Alden very effectively weakened the Governor’s power over a number of years when he was in power, but Caymanians always want the Governor to intervene when we have a big problem.
Caymanians want it all ways.