The 'Pension Changes''

[Garage_Doors]

As an.Independent Financial Adviser, we have found that whilst a number of our clients have expressed an interest in releasing their pension funds, most people won't. When they realise how much tax they will pay, if funds are needed relinquishing other assets is usually more tax efficient. For those with no net relevant earnings, withdrawing funds up to the personal allowance is sensible. For those who are in poor health & want to enjoy their monies, rather than passing the funds on, there is a case.

What these new reforms do, is to give the policyholder empowerment as to do what they want with their pension funds. Even annuities are an option & appropriate for many, especially those who are risk averse & require a guaranteed income.

For those who do not need their pension funds, death benefits have been improved too.

The reforms are welcomed & without being political the opposition have no answer or plans to change the new legislation as far as I am aware.

Just had an advisor round who is going to have a look at all my pensions, some are FSP / guaranteed minimum figures, but the ones that arn't. he' looking to merge them, but fee's if i agree are 5% of the value of the pot, is that figure reasonable?

 

[Steve Foster]

Given that some 20% of the UK stockmarket is held by pension funds & 50% by overseas investors ( some of that by pension funds) there would be a collapse in the fortunes of UK companies, unemployment as well if pension monies were taken out of the stockmarket.

 

[Steve Foster]

Just had an advisor round who is going to have a look at all my pensions, some are FSP / guaranteed minimum figures, but the ones that arn't. he' looking to merge them, but fee's if i agree are 5% of the value of the pot, is that figure reasonable?

Wow! That seems very high. I am not in a bidding war, however we only charge 1% subject to a minimum of £450.00
If we can help, PM me.

 

[timbha]

I may be being dense here but I don't understand which pension is it we can cash in ?

I have 2/3 pensions to come: a state pension and a BT pension which is split into 25 years of a final salary pension and (IIRC) a bit from 2009 onwards which is a "money purchase" thingy (dependant on overall contributions rather than salary). I also get a lump sum on retirement which I'm hoping will be in 5-6 years when I'm 58.

So which one can I sent to Mr Obasanjo of Lagos ?

doesn't apply to state pension or final salary schemes. Only applies to defined contribution schemes, ie one that builds up a pot that you can now: 1) buy an annuity; 2) cash in with 25% tax free or; 3) leave to grow until you want it.

Dont forget peeps that you can take 25% tax free and withdraw the balance in stages when you want it/to avoid tax.

 

[timbha]

Just had an advisor round who is going to have a look at all my pensions, some are FSP / guaranteed minimum figures, but the ones that arn't. he' looking to merge them, but fee's if i agree are 5% of the value of the pot, is that figure reasonable?

5% is way to high. Go for a fixed fee.

 

[Garage_Doors]

Wow! That seems very high. I am not in a bidding war, however we only charge 1% subject to a minimum of £450.00
If we can help, PM me.

Ok, i will PM when i've given him the brush off, he was talking several £'000

 

[Seagull58]

What are the option? I thought that was all you could do with the pension pot when you retire?

NOOOOOOOOO!!!! That was changed a few years ago. You are no longer forced to buy an annuity, even when you turn 75. You can go into income drawdown and take income without giving up the capital.

 

[seagullsovergrimsby]

I may be being dense here but I don't understand which pension is it we can cash in ?

I have 2/3 pensions to come: a state pension and a BT pension which is split into 25 years of a final salary pension and (IIRC) a bit from 2009 onwards which is a "money purchase" thingy (dependant on overall contributions rather than salary). I also get a lump sum on retirement which I'm hoping will be in 5-6 years when I'm 58.

So which one can I sent to Mr Obasanjo of Lagos ?

The good news about your BT pension is the lump sum because it will be tax free. Mine pays out in 5 years time

 

[Cheshire Cat]

Other than annuities, what are the options? Don't fancy the buy to let market at all.

 

[Seagull58]

Just had an advisor round who is going to have a look at all my pensions, some are FSP / guaranteed minimum figures, but the ones that arn't. he' looking to merge them, but fee's if i agree are 5% of the value of the pot, is that figure reasonable?

He's looking to rob you blind. You can certainly talk to an IFA. I opened a SIPP with Hargreaves Lansdown a number of years ago, rolled all my pensions into it and I manage it myself. It sounds like you would not want to take on that risk but a good (value) IFA would certainly point you in the right direction.

 

[Seagull58]

Other than annuities, what are the options? Don't fancy the buy to let market at all.

You can go into income drawdown once you reach 55 with a SIPP. You can preserve the capital, if its invested wisely.

 

[bhanutz]

I run a IFA firm, if you would like some independent advice or guidance, please feel free to PM me.

 

[LamieRobertson]

You can go into income drawdown once you reach 55 with a SIPP. You can preserve the capital, if its invested wisely.[/QUOTE]

thats the nub if you go to a SIPP making those decisions ...I took mine there years ago see earlier post

 

[mac04]

Drawing down from your pension pot sounds like a good idea versus buying an annuity. However, it is risky. You just don't know how long it has to last.

I think that some will be scared of reducing the balance too quickly in case they run out. We could end up with people have good sized pension pots (over £200k) at age 68 who spend virtually none of it in the first few years. They would have been better of being fleeced for an annuity of £10k per year and spending it all each year.

 

[Uncle C]

You can go into income drawdown once you reach 55 with a SIPP. You can preserve the capital, if its invested wisely.

.


Yes it all sounds so easy.

 

[Pickledegg]

Can I take my 25% tax free lump sum at age 55 and leave the rest to grow until I need it?

 

[timbha]

Can I take my 25% tax free lump sum at age 55 and leave the rest to grow until I need it?

yes, yes, yes ......... if your provider is set up to do it - they should be but the Govt didnt give them much time to develop their systems

 

[Pickledegg]

yes, yes, yes ......... if your provider is set up to do it - they should be but the Govt didnt give them much time to develop their systems

Thanks

 

[Papak]

How can the average pension pot only be worth £35K?

I'm early forties and already have about 150K with at least 25 years still to work and contribute.

Are they not including final salary pensions in that figure or is it case of not using mean but mode or median average?

 

[timbha]

How can the average pension pot only be worth £35K?

I'm early forties and already have about 150K with at least 25 years still to work and contribute.

Are they not including final salary pensions in that figure or is it case of not using mean but mode or median average?

some people who change their jobs frequently have a number of small pots