Pensions

[CWAC blue]

Yeah that's near enough what we get, I'm 63 now in a few years I'll be quids in when the OAP hits.

Me 2 get my state pension in August decision to make then on whether to reduce drawdown and carry on as is or keep it and spend spend spend.

 

[blue b4 the moon]

Me 2 get my state pension in August decision to make then on whether to reduce drawdown and carry on as is or keep it and spend spend spend.

Being both ex Civil Servants drawdowns aren't an option....or needed.

 

[chris85mcfc]

Me 2 get my state pension in August decision to make then on whether to reduce drawdown and carry on as is or keep it and spend spend spend.

Just do what you want mate, I know that sounds ridiculous advice!

If it was me I'd probably stay as i am, but reduce the drawdown and let my pot grow

And id probably just make a coffee and sit back and relax at the thought that im content haha!

 

[hampshireblue]

I am lucky enough to have a SIPP and a company pension that I contribute to and my employer pays in to.
I am about 2 and a half years away from my planned retirement date. I could take my tax free 25 percent from my SIPP which should last me for that couple of years. That would mean I could pay 100 percent of my wage into my company pension and gain the tax benefits of increasing my wage value by 25 / 40 percent. This would mean I get an inflated 25 percent from the second pension when I retire. Has anyone else used this approach in pension planning ?

It sounds sensible. I'd be running it past an IFA to sense check it. An hour may cost you £100 but the benefits are potentially huge.

 

[Blue Since 76]

I am lucky enough to have a SIPP and a company pension that I contribute to and my employer pays in to.
I am about 2 and a half years away from my planned retirement date. I could take my tax free 25 percent from my SIPP which should last me for that couple of years. That would mean I could pay 100 percent of my wage into my company pension and gain the tax benefits of increasing my wage value by 25 / 40 percent. This would mean I get an inflated 25 percent from the second pension when I retire. Has anyone else used this approach in pension planning ?

I think you can take the 25% and continue paying in without triggering MPAA, although I don't think you can pay in 100% of your income - think you need to take at least minimum wage.

Only issue would be everything going forwards would be taxable, so you'd need to consider whether that made sense - you may be saying 40% tax now and only paying 20% in the future, for example, although anything below the £50k limit would be 20% both ways, so may only be worth it if salary sacrifice saving NI.

You may be better paying extra pension down to the £50k limit and putting the rest in an ISA, so you can minimise tax in the future. As pensions are about to become part of the IHT calculation but with extra tax when descendants take it out, that also potentially complicates things.

Definitely feels like an instance where support from an IFA may be beneficial

 

[Blue Maverick]

Surely its just the same as pre-retirement, where you have to save your tokens up for a holiday, and you cant just go for a lavish meal every single weekend

I'm not sure why people think that in retirement you're all of a sudden going to be out on adventures every single day!

After all my expenses, I can get by on about £50 a week for normal living, allowing me to always have money to go on holiday or out for meals as and when they arise; I cant imagine that changing much when I'm retired!

That’s what I’m at the moment, I’m a lot younger and have a young family, so allow myself £50 for me, the rest is spent on everything else we need or arises, it’s not a lavish lifestyle and the cost of living rocketing hasnt helped.

 

[Silva Citizen]

I think you can take the 25% and continue paying in without triggering MPAA, although I don't think you can pay in 100% of your income - think you need to take at least minimum wage.

Only issue would be everything going forwards would be taxable, so you'd need to consider whether that made sense - you may be saying 40% tax now and only paying 20% in the future, for example, although anything below the £50k limit would be 20% both ways, so may only be worth it if salary sacrifice saving NI.

You may be better paying extra pension down to the £50k limit and putting the rest in an ISA, so you can minimise tax in the future. As pensions are about to become part of the IHT calculation but with extra tax when descendants take it out, that also potentially complicates things.

Definitely feels like an instance where support from an IFA may be beneficial

I would only be taking the 25 percent until I retired (making the rest of this pot taxable) however I can also take 25 percent of the work one at retirement. Like you say an IFA may help

 

[Blue Since 76]

I would only be taking the 25 percent until I retired (making the rest of this pot taxable) however I can also take 25 percent of the work one at retirement. Like you say an IFA may help

There's other things like the 25% is 'only' up to £268k, so worth making sure you understand all the rules before doing it and what tax liabilities you may create in the future