Cash as an investment
To operate your Hartsfield SSAS effectively and efficiently you will need a scheme bank account, and this is why you might want to consider holding cash as an investment.
We will open a scheme bank account for you. The account will be in the name of the pension scheme, it will receive gross interest and all trustees (including the corporate trustee) must be authorised signatories.
The account will allow you to make contributions into the scheme, make and receive proceeds from any scheme investments, pay for the ongoing expenses of the scheme and it will also be used, ultimately, to pay out your benefits to you on retirement.
Beyond its practical use, the Pension Scheme bank account can be an investment in itself. Cash is generally considered a relatively low risk form of investment, although with lower interest rates the returns are not what they were.
What types of account are there?
To set up your SSAS you will need a current account to receive the initial contribution and any transfers. But as current accounts attract little or no interest, you could consider any of these:
- Higher rate building society or high street bank accounts
- Term deposit or notice accounts
- Cash accounts held through stockbrokers
- Foreign currency accounts
Term deposits and notice accounts
By tying up funds for a longer period, you can generally obtain a better return. But this may not be the best option if your SSAS has ongoing expenses or if there are members whose benefits are in payment. Consider carefully first what speed of access you will need before funds are invested.
Also, by tying up funds for a long period at a fixed rate, you may miss out on better returns if rates subsequently increase.
Foreign currency accounts are permitted, but it would be the responsibility of the member trustees to monitor the exchange rates.
We can talk you through the pros and cons of cash investments, so you pick the best option to suit your needs.