Dickinson Discusses Pension Withdrawal Programs, Banking and High Cost of Living

During a press conference on Monday afternoon, Finance Minister the Honorable Curtis Dickinson acknowledged that, despite the government’s best efforts to help Bermudians during this unprecedented time, the Coronavirus has still made it very difficult for people to make ends meet.

As a result, the government will allow Bermudians to make another temporary withdrawal from their pension.
Unlike the previous pension withdrawal program which had a limit of $12,000, this program will have a limit of $6000, from July 1, 2021 to June 30, 2022. However, this program will be subject to the same criteria that applied in the previous program.

“ [With this program], I was trying to find a balance between the urgent need [that people may have for immediate cash] and my understanding of how compound interest works and how funds grow with the benefit of time,” Minister Dickinson said.

From his observations, Bermudians withdrew a total of around $120 million out of their pension plans last year; most of which he assumed was spent within the local economy.
Although this withdrawal program is open to a lot of people, the government cautions only people who critically need emergency funding to take advantage of it.

“An important consideration [for withdrawing these funds] is the future consequences of withdrawing money now from your pension fund could be material,” Minister Dickinson said. “ Even if the money withdrawn is replaced in the future, it is likely to reduce what is available when someone is no longer generating work-related income. Therefore, people should carefully consider their options.”

Minister Dickinson confirmed that added financial benefit programs brought on by the pandemic will come to an end at the end of next month, but affirmed that people received the same benefit amount last year that they did this year.

“ Last year’s financial benefit was the lesser amount between 60 percent of their paycheck, or $500,” he said. “Depending on which one they were eligible for, that is the benefit that they would receive.”

Minister Dickinson regularly talks with staff at the island’s banks to ensure that they are being as accommodating to their clients and their needs as possible during these extremely tumultuous economic times.

“ The first action for clients who may be having some trouble with the bank should be to reach out,” he said. “There is sometimes a tendency for people to ‘hunker down’ and try to solve the problem themselves, but the best thing they can do is let the bank know that they are having

some challenges. From my experience, banks are generally willing to work with their customers.”

According to Finance Minister Dickinson, the government is very concerned about the high price of food, groceries and living in general and he will have a conversation with my colleagues during our weekly cabinet meeting on the burden that it places on the average Bermudian family and how to adequately address the issue.
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