ey Features of the Stakeholder Pension Plan This key features document gives you the main points about your pension plan. It should be read with your personal illustration, which gives details of the pension you may receive in the future. Please read these carefully and keep them for future reference.

Its aims • To build up a sum of money, in a tax-efficient way, large enough to provide you with an income during your retirement with the possibility, if you wish, of a tax-free lump sum.



Where appropriate, to enable you to contract out of the State Second Pension (S2P). This is explained further in the ‘Questions and answers’ section of this key features document.

Your commitment • You and/or your employer agree to pay regular monthly or yearly contributions into your plan until your chosen retirement age and/or transfer your benefits from an existing pension plan.

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You may pay one-off single contributions to your plan at any time. You allow your plan to build up and then use it to provide a pension. You agree to tell us if your employment or employment status changes, for example if you change from being employed to self-employed.

Risk factors • What you get back at retirement cannot be guaranteed and will depend on how much you pay in, investment performance, which may go down as well as up, and interest rates when you retire.



When you are ready to retire, your pension may be lower than illustrated. This could happen for a number of reasons, for example if: – you stop paying into your plan or take a contribution break – investment performance is less than illustrated – interest rates are lower than illustrated – you start taking your pension earlier than your chosen retirement age – tax rules change – charges increase above those illustrated – you transfer your plan to another company



Your plan can invest in a range of investment funds which carry differing levels of risk.



If you invest in one of our with-profits funds and you withdraw the money at any time other than at your chosen retirement date or on earlier death, it may be necessary to reduce the value of your fund by what we call a smoothing reduction. The purpose of this adjustment is to ensure that investors receive a fair share if they leave with-profits funds before their chosen retirement date and to protect the interests of the continuing investors. Further details are provided in the With-Profits Summary.



If the value of any single contribution or transfer payment falls before notice of cancellation is given, you might not receive back the full amount you have paid in.

Questions and answers What is a stakeholder pension plan? It is a simple savings plan which helps you save for retirement in a tax-efficient way and provides benefits on death before retirement. The Government has set minimum standards that companies must meet for a stakeholder pension. These are to do with contribution levels, costs, and terms and conditions. This plan meets these standards.

How flexible is it? You can pay into the plan regularly every month or year. You can make one-off contributions and change regular contributions at any time, subject to the minimum contribution of £20 and the maximum amounts set by the Inland Revenue. Your employer, if you have one, can also pay into this plan. You can stop or take a break from paying contributions at any time and leave your fund in the plan to benefit from future investment growth. This might occur, for example, if you take a career break. However, any contribution break is likely to reduce your future pension. You can also transfer your pension to another pension scheme. The amount transferred is called a transfer value.

What might I get when I want to retire? Your final fund value will depend on a number of factors. These include how much is paid into the fund, how long you save, the investment growth and charges. Your personal illustration shows examples of what you might receive in the future. Your pension will depend on interest rates at the time you convert the plan into your pension. To do this, you will need to buy another type of plan before you reach age 75. This is called an annuity and you can buy it from any pension company. Alternatively, you can transfer your fund into a plan designed to allow you to delay buying an annuity (until age 75) and take income direct from your fund. For full details of this option, please speak to your Independent Financial Adviser (IFA).

Can I contract out of the State Second Pension (S2P)? This plan can be used to contract out of S2P. You should ask an IFA for more information on this option.

Contracting out means that some of your and your employer’s National Insurance contributions will be paid into your plan by the Inland Revenue, providing you with a pension that replaces some or all of your S2P. The amount of National Insurance contributions paid into your plan has been calculated by the Government to broadly reflect the value of the benefits that would have been built up for you under S2P if you had not contracted out. These contributions are paid yearly. If you are contracted out of S2P, the part of your fund which relates to your contracted-out contributions cannot be used to provide a pension until you reach age 60 (which can be a different age from your chosen retirement age) and cannot be taken as a lump sum. It must be used to provide a pension for you and, on your death in retirement, normally a pension for your husband or wife. Should you die before you retire, the fund built up from contracted-out contributions must normally be used to provide a pension for your husband or wife. If you are not married, it can be paid as a lump sum to your dependant(s).

What choices will I have when I retire? You can usually start taking a pension from your plan at any time between the ages of 50 and 75, including while you are still working. The Inland Revenue will not usually allow you to take a pension before the age of 50 unless you are in a job approved for early retirement, or if you are in ill health. You may be able to choose to take up to 25% of your fund as a tax-free lump sum, but you will receive a smaller pension. This percentage may be less if your plan includes a transfer value. When you retire you can buy a pension that suits you. For example, you could choose a pension that increases each year during retirement, or a pension which is guaranteed to be paid for either five or ten years, irrespective of when you die, or a pension for your husband or wife after you die. You can buy this pension from any pension company. Alternatively, instead of buying a pension you can choose to transfer your fund to other more flexible retirement plans which allow you to cash in only part of your fund or to withdraw income from the fund. Your IFA will be able to give you more details about these options.

How much can be paid into my plan each year? Both you and your employer can pay into your plan. You can pay up to a certain amount – the simple contributions limit – into your pension each tax year whether you are earning or not. In the current tax year the simple contributions limit is £3,600. You can pay more than this amount if you have earnings either from employment or self-employment in this tax year or in a recent tax year. If so, the Inland Revenue sets a maximum amount you can pay into your plan in any tax year depending on your age (a tax year runs from 6 April in one year to 5 April in the next). Monthly contributions are payable by direct debit. Yearly contributions can be made by direct debit or cheque. Single contributions and transfer values are payable by telegraphic transfer or cheque. You can transfer the value of any pension plan you have with another company into this plan. There is no guarantee that doing so will increase your total pension.

What about tax? Your own contributions are paid net of basic rate income tax and we collect the tax relief from the Inland Revenue. This means that if £100 is paid into your plan you only pay £78. If you are in a higher tax band, you claim the extra relief from the Inland Revenue on your annual tax return. Growth in the value of the plan is free from capital gains tax and certain types of dividends paid to the plan are free from income tax. If you die before you retire, there is normally no inheritance tax payable on your fund value. When you retire, under current rules, the cash lump sum is tax free but the actual pension is treated as earned income and is taxable. Tax rules can change. The assumed basic rate of income tax is 22% and the higher rate is 40%. For more information you may wish to speak to your IFA.

Where are my contributions invested? We will invest the total contribution made by you. Charges will be taken from your fund value as detailed under ‘What are the charges?’ below. We offer a default investment choice under our Stakeholder Pension Plan. This investment fund is the Stakeholder Balanced Lifestyle Fund. This fund follows a defined risk-graded investment strategy, aiming to build your pension fund in the early years, then protect its purchasing power as you near retirement. To achieve this, contributions will initially be invested in funds with greater growth prospects. Then, as you approach retirement, your pension fund will gradually, and automatically, move to lower-risk investments to protect the fund. If you do not want to invest your contributions in the default investment fund, you can choose from our wide range of internal and external investment funds, and so choose the funds to suit your individual investment strategy. Further details on the funds available can be found in our Pension Fund Selection brochure. Within our unit-linked funds:

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each of our funds is made up of units we use your contributions to buy units in the funds you choose the price of one unit in each fund depends on the value of investments

We work out the value of your plan based on the total number of units you have in each fund. If the unit prices rise or fall, so will your plan value. Further details are provided in the summary attached to your personal illustration. Our with-profits funds aim to smooth out the volatility normally associated with direct investment in financial markets. Our with-profits funds currently available do not offer bonuses. We change the unit prices on a daily basis to reflect smoothed investment returns. These are calculated using the actual growth on the assets in the fund and our expected growth rate for the fund. The expected growth rate is not guaranteed and is subject to change. Smoothing will not be able to counteract the impact of a sustained decline in investment returns. Further details are provided in the With-Profits Summary attached to your personal illustration. We may apply a smoothing increase or smoothing reduction on withdrawal from any with-profits fund.

You can switch your payments in and out of various funds to change the mix of investments. You can make up to 20 switches a year and any number of funds can be switched at any one time. There is no charge for doing this. Full details are in your Policy Conditions booklet.

What are the charges? We charge for managing your plan and investments. We recover these charges by making deductions from your plan over the years to your retirement. We take these charges from your fund value. Your illustration shows the effect of the charges on your plan. Each month we will calculate the total fund value of your plan, including any contractedout value. If the value is £50,000 or more we will add units to your plan. This amounts to 0.25% of your fund value a year. We may vary the charges and our terms in the future. Further details are available in your Policy Conditions booklet or on request.

What other benefits can I choose? Waiver of contribution benefit is also available as a separate plan set up alongside your Scottish Equitable Stakeholder Pension. This means your contributions will continue to be paid if you become ill and are unable to contribute to your plan. You do not have to take this benefit. The cost of this benefit can vary depending on your occupation and health. These benefits will stop if you stop paying into your plan. Any contributions paid towards the cost of waiver of contribution benefit will not qualify for tax relief.

What happens to the plan if I die before I retire? We will pay the value of your fund as a cash lump sum. The amount of the lump sum which can be paid from any money transferred from a company scheme may be restricted by the Inland Revenue. This means that there may be a maximum amount of cash lump sum which can be paid. If you have arranged your plan under trust, we will pay the lump sum to the trustees. If it is not arranged under trust, we will decide who to pay the lump sum to. We take into account your circumstances when you die and anyone you have previously stated you want the money to go to. If you have transferred funds from another pension scheme, we may have to use part of the amount to provide a pension for your husband or wife, or dependant(s).

Can I transfer my plan? You can transfer your plan to an approved pension plan with another company at any time before you start taking a pension. There will be no charge for doing this. Your personal illustration gives examples of how much you could transfer to another plan depending on when you transfer.

Can I change my mind? After you have invested, you will receive a notice telling you about your right to change your mind, how to cancel and the length of the cancellation period. If you do decide to cancel, you must notify us within 30 days of receiving the cancellation notice and we will give you your money back. If you have made a single contribution, or a transfer payment, and in the meantime the value of the underlying investment has fallen, you may not receive back the full amount you paid in.

How will I know how my plan is doing? We will send a yearly statement, which will show how your plan is performing and its current value. You can also access information about your plan online at www.scottishequitable.co.uk To find out how our funds are performing, you can check our prices daily either in the Financial Times or on our website at www.scottishequitable.co.uk

How to contact us If you need any advice or are unsure of the suitability of this pension plan, your IFA should be your first point of contact. We are not allowed to give you any financial advice. If you have any general questions at any time, you can phone us or write to us. Call us on:

08456 10 00 10, Monday to Friday, 8.30am to 5.30pm. We may monitor calls to improve our service.

Or write to us at:

Scottish Equitable House Edinburgh Park Edinburgh EH12 9SE

If you wish to make additional contributions or switch funds, please contact your IFA.

Other information How to complain If you want to complain about any aspect of the service you have received, please contact us in the first instance at the above address. A copy of our internal complaint handling procedures is available upon request If your complaint is not dealt with to your satisfaction, you can then complain to: The Financial Ombudsman Service South Quay Plaza 183 Marsh Wall London E14 9SR Tel: 0845 080 1800 Making a complaint should not stop you from taking legal action later on.

Terms and conditions This key features document is only a summary of the main points of our Stakeholder Pension Plan. Full details can be found in the Policy Conditions booklet. Should there, at any point in the future, be any changes to the current terms and conditions of your plan, you will be notified in writing by us.

Law If, when the contract starts, you reside in the UK, then the applicable law is the law of that part of the UK where you reside. Otherwise Scots law will apply. The applicable law can only be changed if both you and Scottish Equitable agree.

Compensation If this product was recommended to you by an IFA, you may have a legal right to compensation if it is established that the recommendation was unsuitable when it was made. The Financial Services and Markets Act 2000 covers your plan. Information on compensation arrangements is available from Scottish Equitable on request. Further information is available from the Financial Services Authority or the Financial Services Compensation Scheme. The information contained in this key features document is relevant to our current product terms. For full details of the charges applicable to your plan please refer to your personal illustration. This information is based on our understanding of current taxation law and Inland Revenue practice, which may change in the future.

Scottish Equitable plc, Registered Office: Edinburgh Park, Edinburgh EH12 9SE. Registered in Scotland (No. 144517). Regulated by the Financial Services Authority. A member of the AEGON UK Marketing Group.

Scottish Equitable has been accredited by the independent Pensions Protection Investments Accreditation Board as having met demanding standards for clarity, quality and customer service.

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