Yeah I'm 55, time to raid the pension
Discussion
Because as a lump of money it's useful but as a pension pot it's useless.
Not going to do anything rash so I just contacted my pension company to ask about options.
Seems they don't deal with these 'draw downs' and handed my details over to some investment company that I can't find many details of on the net.
Young guy calls me but I first stop him and ask about charges. Seems there are some.
How many folk my age are gonna be ripped off over this eh!
I told him that I wasn't doing anything yet.
So guys, what should I do. I presume I can transfer the whole amount to a company that I am happy with?
And the age old question, where can I find a financial advisor that isn't going to rip me off.
Any help greatly appreciated. Cheers.
Not going to do anything rash so I just contacted my pension company to ask about options.
Seems they don't deal with these 'draw downs' and handed my details over to some investment company that I can't find many details of on the net.
Young guy calls me but I first stop him and ask about charges. Seems there are some.
How many folk my age are gonna be ripped off over this eh!
I told him that I wasn't doing anything yet.
So guys, what should I do. I presume I can transfer the whole amount to a company that I am happy with?
And the age old question, where can I find a financial advisor that isn't going to rip me off.
Any help greatly appreciated. Cheers.
raiding your pension is easy - and I'm not surprised its useless as a "pension" as at 55 you may have 40 years to live of it. Given you were a kid 40 years ago it' s a bit much to expect it to last that long at a decent rate!
The issue is that you probably mean you just want the tax free cash - which leaves the rest in a drawdown plan.....historically used to provide ongoing income in retirement. Now used to hold the left overs after someone has bought a new kitchen and taken the family to Spain for 2 weeks......and once the PPI issue is over I expect the claims people will move onto those with drawdown plans that were "never told" buying a new car at 55 would affect the income they'd be able to muster up at 70!
Not surprised the industry is pushing people to any sort of advice to cover their backs (and advice costs)
The issue is that you probably mean you just want the tax free cash - which leaves the rest in a drawdown plan.....historically used to provide ongoing income in retirement. Now used to hold the left overs after someone has bought a new kitchen and taken the family to Spain for 2 weeks......and once the PPI issue is over I expect the claims people will move onto those with drawdown plans that were "never told" buying a new car at 55 would affect the income they'd be able to muster up at 70!
Not surprised the industry is pushing people to any sort of advice to cover their backs (and advice costs)
Why are you wanting to 'raid' the pension is the first question to be asked?
If you've got any other assets it's probably the last place you should be drawing capital/income from if at all possible given the last changes in pensions legislation.
If it's a Final Salary scheme why transfer it, with the extra costs, the requirement for advice, requirement to manage it, rather than let someone else do so and pay the fees as well as taking the risk on your behalf.
That's a short reason why you need decent advice, not internet ramblings.
If you've got any other assets it's probably the last place you should be drawing capital/income from if at all possible given the last changes in pensions legislation.
If it's a Final Salary scheme why transfer it, with the extra costs, the requirement for advice, requirement to manage it, rather than let someone else do so and pay the fees as well as taking the risk on your behalf.
That's a short reason why you need decent advice, not internet ramblings.
I have 3 very small private pensions which I had been planning to convert to cash but they've been performing very well with approx. 10% year on increases with no additional funding. I don't need the money, so am happy for the pension companies to keep investing my very small pots well. I will be taking them at some point as all 3 are below £20K - and not worth combining or buying an annuity with.
I have a final salary type pension as well, which will be my main income provider.
I have a final salary type pension as well, which will be my main income provider.
It's not a final salary pension. Just a private one I have been paying into since 1998.
I'm not earning well and struggling to pay my rent so the now is important not the future.
If I can buy a caravan say with the cash it'll save me from going under.
So it's desperation that's making me want to cash it in, not the need for a toy or holiday.
Also I meant it is projected to be useless at retirement age.
I'm not earning well and struggling to pay my rent so the now is important not the future.
If I can buy a caravan say with the cash it'll save me from going under.
So it's desperation that's making me want to cash it in, not the need for a toy or holiday.
Also I meant it is projected to be useless at retirement age.
croyde said:
It's not a final salary pension. Just a private one I have been paying into since 1998.
I'm not earning well and struggling to pay my rent so the now is important not the future.
If I can buy a caravan say with the cash it'll save me from going under.
So it's desperation that's making me want to cash it in, not the need for a toy or holiday.
Also I meant it is projected to be useless at retirement age.
Hope it works out well for you. I'm not earning well and struggling to pay my rent so the now is important not the future.
If I can buy a caravan say with the cash it'll save me from going under.
So it's desperation that's making me want to cash it in, not the need for a toy or holiday.
Also I meant it is projected to be useless at retirement age.
As you have found, providers are not obliged to offer the new pension freedoms.
If you are concerned about costs, perhaps transfer to a simple SIPP (eg Hargreaves Lansdown) and then cash it in under the SIPP.
25% would be tax free, the balance subject to income tax.
If you are concerned about costs, perhaps transfer to a simple SIPP (eg Hargreaves Lansdown) and then cash it in under the SIPP.
25% would be tax free, the balance subject to income tax.
Edited by PurpleMoonlight on Thursday 28th September 14:04
croyde said:
It's not a final salary pension. Just a private one I have been paying into since 1998.
I'm not earning well and struggling to pay my rent so the now is important not the future.
Would a better idea not be to find a way to increase your income now?I'm not earning well and struggling to pay my rent so the now is important not the future.
Bar work, postal work over Christmas, taxi jobs or the like?
I'm 55 too, the day before Croyde from memory. I suspect I may be fortunate enough to be in a slightly better place financially. My plan is to keep ploughing money into it, currently circa £800/month, up to age 60. Retire at 60 and take my 25%, divide it by 84, and live off that much per month for the next 7 years (plus some other income we have from other sources.) Then at 67 I'll get my state pension and start drawing down on the 75% of the pot that's left.
I guess I might raid the 75% pot to the amount of my annual tax free allowance each year from 61-66, and just stick it in an ISA.
That's the plan. If any pensions gurus want to tell me I'm an idiot and why, I'll be very grateful.
I guess I might raid the 75% pot to the amount of my annual tax free allowance each year from 61-66, and just stick it in an ISA.
That's the plan. If any pensions gurus want to tell me I'm an idiot and why, I'll be very grateful.
croyde said:
With my current health and family history I doubt I need to worry about that far in the future.
I'll rob a bank and either succeed or get caught. A win win situation. 3 meals a day and a bed
If you're serious you need to get yourself a counsellor or a psychologist and a financial advisor.I'll rob a bank and either succeed or get caught. A win win situation. 3 meals a day and a bed
kurt535 said:
any IFA will take their slice. one poor sod my way got done 8% a few months ago.....my jaw dropped
That's gotta be a mis-selling case, surely. Imagine they could claw some cash back if they filed an official complaint to the FCA, etc.IFAs are just dodgy salespeople. They should be treated like car salesmen.
Yipper said:
kurt535 said:
any IFA will take their slice. one poor sod my way got done 8% a few months ago.....my jaw dropped
That's gotta be a mis-selling case, surely. Imagine they could claw some cash back if they filed an official complaint to the FCA, etc.IFAs are just dodgy salespeople. They should be treated like car salesmen.
PositronicRay said:
Yipper said:
kurt535 said:
any IFA will take their slice. one poor sod my way got done 8% a few months ago.....my jaw dropped
That's gotta be a mis-selling case, surely. Imagine they could claw some cash back if they filed an official complaint to the FCA, etc.IFAs are just dodgy salespeople. They should be treated like car salesmen.
janesmith1950 said:
More typical would be 1.5% to 3% for a regular pension (that is taken from the fund itself).
Rates like 8% are typically reserved for dodgy final salary mechants who are close to retirement.
The challenge, is suspect, is finding good honest advice from a decent IFA, as I believe one is obliged to do if one wants control over that pot. Rates like 8% are typically reserved for dodgy final salary mechants who are close to retirement.
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