Cashing in a pension but only mid 30s?? Is it possible??
Discussion
I currently have a pension circa £8k on hold from a job I had as a grad fresh from uni, left the company and never paid into it again.
Since then I have taken a pension with my current company and all is going well for the last 10 years.
Now this £8k sitting there, its earning me little interest and I would like to invest elsewhere. I know I cant draw down on it till I'm at least 55 if not older but I have heard of agents who will transfer it for a 'good' commision.
I'd basiscally like to get my hands on the cash to invest elsewhere and start to build a portfolio rather of different things rather just have the 1 pension.
Any help or guidance would help
Since then I have taken a pension with my current company and all is going well for the last 10 years.
Now this £8k sitting there, its earning me little interest and I would like to invest elsewhere. I know I cant draw down on it till I'm at least 55 if not older but I have heard of agents who will transfer it for a 'good' commision.
I'd basiscally like to get my hands on the cash to invest elsewhere and start to build a portfolio rather of different things rather just have the 1 pension.
Any help or guidance would help
You don't need to turn it into cash to be in control of its destiny.
If you start a SIPP you can transfer the value into that and then invest in what you like, subject to the normal pension rules. The outgoing pension provider will take a turn on the transfer value but the incoming SIPP provider shouldn't sting you.
If you want it as cash then remember it was subject to very generous tax relief going in and all the scams that say you can turn it into cash just end up with you facing a major tax bill and gigantic comission charges.
If you start a SIPP you can transfer the value into that and then invest in what you like, subject to the normal pension rules. The outgoing pension provider will take a turn on the transfer value but the incoming SIPP provider shouldn't sting you.
If you want it as cash then remember it was subject to very generous tax relief going in and all the scams that say you can turn it into cash just end up with you facing a major tax bill and gigantic comission charges.
the back of a fag packet answer is
SIPP or transfer to your current provider as AVCs or 'buying years'
the proper answer is speak to an IFA - if you are a member of a professional representation organisation / union they may be able to link you up with an IFA for free / reduced rate .
SIPP or transfer to your current provider as AVCs or 'buying years'
the proper answer is speak to an IFA - if you are a member of a professional representation organisation / union they may be able to link you up with an IFA for free / reduced rate .
Beware pension liberation schemes (Google it), they are a scam and technically illegal. Anyone saying you can get you hands on your cash sum now is a crook. Various organisations, including HMRC, have set up a group to watch out for this. Most of these are actually operating from abroad.
The crooks say you can take cash now. They actually pay you a cash sum after maybe a 30% fee and then what they don't tell you is that because the payment is technically an unauthorised payment HMRC will tax the gross amount at 55%. So, you agree the deal and maybe you get 15% of the cash you expect, you lose 85%.
By the way, just to be clear, a SIPP is not pension liberation.
R.
The crooks say you can take cash now. They actually pay you a cash sum after maybe a 30% fee and then what they don't tell you is that because the payment is technically an unauthorised payment HMRC will tax the gross amount at 55%. So, you agree the deal and maybe you get 15% of the cash you expect, you lose 85%.
By the way, just to be clear, a SIPP is not pension liberation.
R.
The Leaper said:
Beware pension liberation schemes (Google it), they are a scam and technically illegal. Anyone saying you can get you hands on your cash sum now is a crook. Various organisations, including HMRC, have set up a group to watch out for this. Most of these are actually operating from abroad.
The crooks say you can take cash now. They actually pay you a cash sum after maybe a 30% fee and then what they don't tell you is that because the payment is technically an unauthorised payment HMRC will tax the gross amount at 55%. So, you agree the deal and maybe you get 15% of the cash you expect, you lose 85%.
By the way, just to be clear, a SIPP is not pension liberation.
R.
What he said! Absolutely rife at the moment and HMRC/the Pensions Regulator is only just starting to crack down on it. The crooks say you can take cash now. They actually pay you a cash sum after maybe a 30% fee and then what they don't tell you is that because the payment is technically an unauthorised payment HMRC will tax the gross amount at 55%. So, you agree the deal and maybe you get 15% of the cash you expect, you lose 85%.
By the way, just to be clear, a SIPP is not pension liberation.
R.
A SIPP is a form of pension that you can transfer money into, as opposed to a personal pension (PP) or stakeholder. If you have a modest amount and aren't adventurous, engaged or informed with investment planning, don't even bother considering it. The 'hurdle' that your funds will have to jump, just to pay costs, will create a huge demand on investment returns. The effect will be the same as achieving similar returns on a less better performing portfolio, within a more 'vanilla' pension (PP etc).
I prefer GingeR's take on this.
The clue is in the name SIPP = Self Invested Personal Pension. It's just a personal pension where you take more control over the investments held. If you aren't willing or able to spend a lot of time on the investment strategy then it is a waste of money having the extra flexibility and you might as well go for a basic Personal Pension.
The clue is in the name SIPP = Self Invested Personal Pension. It's just a personal pension where you take more control over the investments held. If you aren't willing or able to spend a lot of time on the investment strategy then it is a waste of money having the extra flexibility and you might as well go for a basic Personal Pension.
Zigster said:
I prefer GingeR's take on this.
The clue is in the name SIPP = Self Invested Personal Pension. It's just a personal pension where you take more control over the investments held. If you aren't willing or able to spend a lot of time on the investment strategy then it is a waste of money having the extra flexibility and you might as well go for a basic Personal Pension.
No harm looking at your current investment strategy though. Likely it's in a lifestyle fund and some are smarter than others in the way they alter your allocation against your age. The clue is in the name SIPP = Self Invested Personal Pension. It's just a personal pension where you take more control over the investments held. If you aren't willing or able to spend a lot of time on the investment strategy then it is a waste of money having the extra flexibility and you might as well go for a basic Personal Pension.
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