Multiple pension pots

[mikef]

Hi - I did a search here but didn't find an answer to my specific question

I'm wondering about a strategy for managing multiple pension pots in retirement

The obvious answer is to combine them to simplify the admin, however I have a number of plans that (reputable) wealth managers and advisors say they are not able to deal with under their restricted advice services

These include both defined contribution plans (about 1/3 of total) and a smaller with-profits fund with guaranteed growth rate which seems worth hanging on to as a safe bet if the market dips

So I am looking at combining other money-market pension funds into a single pot, and having at least two other pensions to manage

Does anyone have experience of a successful strategy (beyond "combine them anyway") for handling lump sumps, draw-downs, etc, with multiple pension funds at and after retirement?

[mikef]

Just a bump, as I'd be surprised if no-one else is in the situation of retiring with funds they can't combine...

[mikef]

Thanks, all over £30K, most funds in the hundreds. I have wealth managers looking at this, but interested to hear what others have done in similar circumstances, as a second opinion

[Carbon Sasquatch]

It's complicated.... The DC stuff is easy and can be transferred into one place

I have 3 DB pensions - each with differences in retirement age, reductions if taken early, reductions for tax free cash etc etc

I expect to leave the DB stuff where it is, but just trying to work out the age to take it, with or without any tax free cash is complicated enough that I'm paying an IFA to look into it for me.

Edited by Carbon Sasquatch on Monday 4th October 14:03

[mikef]

Interesting - thanks CS

[NickCQ]

mikef said:

Thanks, all over £30K, most funds in the hundreds. I have wealth managers looking at this, but interested to hear what others have done in similar circumstances, as a second opinion

It's not totally clear from your post what you are looking for. Do you want someone to give you holistic advice across all your assets, or is it more whether someone's got a good app / website where they can track valuations, drawdowns and so forth across different providers? A financial planner should be able to do the former even if they aren't directly talking about assets they manage.

FWIW, don't cash in the with-profits policy if it's an old one with a high guarantee!

[mikef]

Thanks Nick. It’s more about the practicalities of drawing down and taking potential lump sums from multiple pension pots. A spreadsheet might be useful as a worked example

[Mazinbrum]

Better to combine them if you want to maximise your tax free cash.
See - https://youtu.be/AMJ8Ya3CPj4

[mikef]

Hi, I understand that, but my question is how to proceed if I can’t or shouldn’t, for other reasons

[Carbon Sasquatch]

Big spreadsheet time.

I'm starting with the DB/annuity blocks - trying to figure out the optimum way/time to take each. The DC stuff is easier and more flexible, so come to that last (in planning terms) and use it to smooth the way to my desired outcome.

By desired outcome - I have an ideal spend capacity - per year - well it's actually in 5 year blocks. Then I have each funding source & when that kicks in. I can then tweak things to bring in early or delay.

I've worked things out in net terms, so factored in tax tree amounts where applicable - but understand what gross incomes I need to deliver the net amount I want each year.

I started at the end - what's the amount I need at 85 - or whatever age you think is somewhat constant where your day basically consists of watching TV in your chair. That much needed a fixed level of funding from guaranteed sources. I then front loaded the rest.

I chose to ignore any expensive care at the end - and similarly no inheritance considerations. Anything that I fail to spend enjoying my early retirement and/or make from outsized returns can fund those things.

Just my way of thinking & there are likely many other equally valid options....

[mikef]

Thanks CS - is that all drawdown, and at what point are you crystallising any amounts by planning to take lump sums?

[Enut]

mikef said:

Hi - I did a search here but didn't find an answer to my specific question

I'm wondering about a strategy for managing multiple pension pots in retirement

The obvious answer is to combine them to simplify the admin, however I have a number of plans that (reputable) wealth managers and advisors say they are not able to deal with under their restricted advice services

These include both defined contribution plans (about 1/3 of total) and a smaller with-profits fund with guaranteed growth rate which seems worth hanging on to as a safe bet if the market dips

So I am looking at combining other money-market pension funds into a single pot, and having at least two other pensions to manage

Does anyone have experience of a successful strategy (beyond "combine them anyway") for handling lump sumps, draw-downs, etc, with multiple pension funds at and after retirement?

Have you spoken to an Independent Financial Adviser rather than advisers offfering a 'restricted advice service'?

[Carbon Sasquatch]

mikef said:

Thanks CS - is that all drawdown, and at what point are you crystallising any amounts by planning to take lump sums?

Still working through it with an adviser.

I only plan to take lump sums for tax efficiency, so the 25% on DC & I expect to crystallise all early - but that's as I'm already at LTA so additional growth isn't a particular benefit, otherwise I'd likely delay until needed and risk the 25% being withdrawn without notice in some future budget.

On the DB stuff, still crunching the numbers on whether any tax free cash element is worth the subsequent reduction in monthly payments

[mikef]

Enut said:

Have you spoken to an Independent Financial Adviser rather than advisers offfering a 'restricted advice service'?

I have an unhappy history with financial advisors, independent and otherwise, but that’s a possibility. I’d like to understand options when going into a conversation with either

[Derek Chevalier]

mikef said:

Hi - I did a search here but didn't find an answer to my specific question

I'm wondering about a strategy for managing multiple pension pots in retirement

The obvious answer is to combine them to simplify the admin, however I have a number of plans that (reputable) wealth managers and advisors say they are not able to deal with under their restricted advice services

These include both defined contribution plans (about 1/3 of total) and a smaller with-profits fund with guaranteed growth rate which seems worth hanging on to as a safe bet if the market dips

So I am looking at combining other money-market pension funds into a single pot, and having at least two other pensions to manage

Does anyone have experience of a successful strategy (beyond "combine them anyway") for handling lump sumps, draw-downs, etc, with multiple pension funds at and after retirement?

Even if the wealth manager isn't directly managing the DC and with-profits funds they should still be able to build you a retirement plan with a withdrawal strategy that incorporates these.

A decent planning tool such as:

https://www.planwithvoyant.co.uk/content/en_GB/ind...

will allow the adviser to extract the data (for example withdrawals per fund on a yearly basis) for you to recreate on a spreadsheet if you desire.

Did they give a reason why the DC pots were off-limits?

[mikef]

Thanks CS and DC. On the last question, after talking to the last provider for a couple of weeks, they let me know that advising on moving that pension to a combined fund (eg a SIPP) was outside the bounds of their restricted advice service

[Derek Chevalier]

mikef said:

Thanks CS and DC. On the last question, after talking to the last provider for a couple of weeks, they let me know that advising on moving that pension to a combined fund (eg a SIPP) was outside the bounds of their restricted advice service

It might be worth pushing back on that. It could be cost - for example a workplace scheme @0.2%pa might not make sense to transfer to all-in fees of ~2% (typical of wealth manager).