Retiring

[sky tot]

Crickey my rent is over 9k year!! And will only go up

I was very similar to you . I had a free pension telephone interview with a government advisor. They won’t advise you what you should or shouldn’t do but they tell you your options . Glad I did it because the type of pension I have seems to have bonuses with it which she said I would lose if I took my pension now . Said they don’t do this type of pension anymore..

 

[Bluemanc100]

Thanks trouble is with me I dont understand it very well.

Just looked at buying an annuity for 100k and that gives me 1800 a year ! My rent is 800 per month !

I dont have any debt and am good with living within my means just dont understand how piss poor pensions seem to be, to me my pot seems massive ;) if I took it all out to live on I could live comfortably until I pop off ! ( I think lol )

Pensions are a minefield and I don't get the detail easily either

Personally I wouldn't go anywhere near an annuity... I am going drawdown after taking the 25% tax free...

 

[M18CTID]

Pensions are a minefield and I don't get the detail easily either

Personally I wouldn't go anywhere near an annuity... I am going drawdown after taking the 25% tax free...

I don't understand some of the detail either but I agree that annuities are shit. Once upon a time, they were the only option for many but since Osborne brought in pension freedoms in 2015 where we can access some or all of our pension from a certain age (as opposed to having it drip fed to us via a piss poor annuity), drawdown is surely the way to go. @give it to gordon - you may well need some financial advice but you can probably do a little bit of research into this yourself. Some sites have a pension drawdown calculator which you can play around with and gives you an idea of how long your pot may last based on various growth scenarios for what remains in the pot. Hargreaves Lansdown has a good one and has scenarios based on 2%, 5%, and 8% annual growth. I was dicking about with it the other week and put some rather optimistic figures in regarding my retirement pot, how much I would want to draw per year, and factored in 8% annual growth. In one fantasy scenario, I managed to turn a several hundred thousand pound pension pot into about £8 million by the time I reach 99!

 

[denislawsbackheel]

When it would be no use to you!

 

[Citizen of Legoland]

When it would be no use to you!

Might be able to attract a nice wife though ...

 

[denislawsbackheel]

At 99 you wouldn’t remember what do do, and if you could remember would not be able to do it!

 

[DenisLawBackHeel74]

Im looking to transfer an old DB scheme into a new pension. I don’t want to pay any upfront costs of doing this (Fidelity charge £1k upfront for advice and recommendation).....

Its a legal requirement to take advice and most investment mgmt companies charge about £3.5k for the advice and the transfer...(robbing twats).

Does anyone know companies that don’t charge upfront fees ?

 

[paulchapo]

Im looking to transfer an old DB scheme into a new pension. I don’t want to pay any upfront costs of doing this (Fidelity charge £1k upfront for advice and recommendation).....

Its a legal requirement to take advice and most investment mgmt companies charge about £3.5k for the advice and the transfer...(robbing twats).

Does anyone know companies that don’t charge upfront fees ?

This is the annoying thing about pensions the costs involved sorting something out. You pay into a pension fund for years yet if you want to do drawdown or similar you have to pay a financial advisor to set it up. I just presumed you could do it through the people you have paid your money in for years but that's not the case. It seems bonkers to me. It's like paying into an insurance company, then when you have a claim having to pay another company to process your claim.

 

[SWP's back]

Thanks trouble is with me I dont understand it very well.

Just looked at buying an annuity for 100k and that gives me 1800 a year ! My rent is 800 per month !

I dont have any debt and am good with living within my means just dont understand how piss poor pensions seem to be, to me my pot seems massive ;) if I took it all out to live on I could live comfortably until I pop off ! ( I think lol )

Do. Not. Buy. An. Annuity.

Since 2015 you don’t have to and you’d be mad to, the rates are fucking shite now as 15 year gilt yields are through the floor.

 

[SWP's back]

Im looking to transfer an old DB scheme into a new pension. I don’t want to pay any upfront costs of doing this (Fidelity charge £1k upfront for advice and recommendation).....

Its a legal requirement to take advice and most investment mgmt companies charge about £3.5k for the advice and the transfer...(robbing twats).

Does anyone know companies that don’t charge upfront fees ?

The fees are usually taken from the transferred amount so wouldn’t be an “up front” cost per se matey.

 

[SWP's back]

This is the annoying thing about pensions the costs involved sorting something out. You pay into a pension fund for years yet if you want to do drawdown or similar you have to pay a financial advisor to set it up. I just presumed you could do it through the people you have paid your money in for years but that's not the case. It seems bonkers to me. It's like paying into an insurance company, then when you have a claim having to pay another company to process your claim.

It’s really not.

The reason that a transfer out of a DB scheme needs advice on over £30,000 is that it’s a mine field and you really do need to be adequately advised. A DB transfer report is about 60-70 pages and takes a huge amount of time to prepare to ensure it’s correct for your situation.

The company putting it together end up costing a great deal less than a plumber does for the same man/woman hours, then you factor in the enormous PI Insurance a G60 pension transfer specialist had to take out in case they ever give duff advice and the 5 years of experience and training etc etc, £2k for a transfer report on a £500k pension is a bargain. Once in a SIPP, you can make that up in a morning.

If you’re already in a personal pension or a defined contribution pension then you don’t need advice and can sort yourself out. If you’re in a Defined Benefit pension and happy with the income it’s going to produce (and don’t care about leaving the whole of it to your spouse - or any of it at all to your kids) then you can stay in that and it won’t cost you anything for advice again.

 

[DenisLawBackHeel74]

The fees are usually taken from the transferred amount so wouldn’t be an “up front” cost per se matey.

Yeah that’s what i thought. I had a call with Fidelity and they insist on an upfront fee of £1,050 to provide the advice and recommendation....followed by £2,500 if I decide to have them do the transfer...

Edit: you have to pay the initial fee upfront but they will take the 2.5k when the pension transfers..

 

[paulchapo]

It’s really not.

The reason that a transfer out of a DB scheme needs advice on over £30,000 is that it’s a mine field and you really do need to be adequately advised. A DB transfer report is about 60-70 pages and takes a huge amount of time to prepare to ensure it’s correct for your situation.

The company putting it together end up costing a great deal less than a plumber does for the same man/woman hours, then you factor in the enormous PI Insurance a G60 pension transfer specialist had to take out in case they ever give duff advice and the 5 years of experience and training etc etc, £2k for a transfer report on a £500k pension is a bargain. Once in a SIPP, you can make that up in a morning.

If you’re already in a personal pension or a defined contribution pension then you don’t need advice and can sort yourself out. If you’re in a Defined Benefit pension and happy with the income it’s going to produce (and don’t care about leaving the whole of it to your spouse - or any of it at all to your kids) then you can stay in that and it won’t cost you anything for advice again.

I had two pensions. My larger one, the one I live on now, was frozen in 2001. A new one was started and I contributed into it until I took early retirement in 2016. This is obviously much smaller than the first but is an okay amount. All I want to do is take my cash free lump sum then draw down a set amount per year until it runs out. During this time my state pension kicks in so this secondary pension is spending money for holidays ( If they ever happen again) or replacing items/house repairs etcetera. I just presumed that like an annuity I could do this through my pensions advisor but I can't. It's frustrating and complicated.

 

[SWP's back]

Yeah that’s what i thought. I had a call with Fidelity and they insist on an upfront fee of £1,050 to provide the advice and recommendation....followed by £2,500 if I decide to have them do the transfer...

Edit: you have to pay the initial fee upfront but they will take the 2.5k when the pension transfers..

Every company is different I guess, but I don’t often come across companies charging before undertaking work.

I had two pensions. My larger one, the one I live on now, was frozen in 2001. A new one was started and I contributed into it until I took early retirement in 2016. This is obviously much smaller than the first but is an okay amount. All I want to do is take my cash free lump sum then draw down a set amount per year until it runs out. During this time my state pension kicks in so this secondary pension is spending money for holidays ( If they ever happen again) or replacing items/house repairs etcetera. I just presumed that like an annuity I could do this through my pensions advisor but I can't. It's frustrating and complicated.

Are they Defined Benefit or Defined Contribution?

If it’s the latter you should be able to do that without any advice.

 

[DenisLawBackHeel74]

Every company is different I guess, but I don’t often come across companies charging before undertaking work.



Are they Defined Benefit or Defined Contribution?

If it’s the latter you should be able to do that without any advice.

Thx SWP, responded to your PM.

 

[ganganvince]

Yeah that’s what i thought. I had a call with Fidelity and they insist on an upfront fee of £1,050 to provide the advice and recommendation....followed by £2,500 if I decide to have them do the transfer...

Edit: you have to pay the initial fee upfront but they will take the 2.5k when the pension transfers..

When I transfered out from a DB fund the advisors I used ( Burfields) took nothing until they actually transferred the money which was taken from the pot

 

[Tommy_Catons_Perm]

Are we conflating the cost of advice with the cost of setting up drawdown on a DC pension here ? It seems to me that drawdown is not offered by every DC pension scheme provider, it might not be simple to set up, and may involve costs in transferring to another provider that will do draw down.

I have some DC pensions that I will want to drawdown within 5 years and it does not look straight forward. Contrast that to a DB scheme I will probably receive few years after that, which looks simple with no extra costs. (Excepting cost of financial advise if I choose to seek it)

 

[Kazzydeyna]

Quick question for those who understand these things.

I am fortunate enough to have 2 pension pots, plus another widows pension (currently 7500 pa and index linked each year).

One from a previous employer is forecasted to pay me a annuity of 13000pa as well as a smaller lump sum. This is a final salary scheme and is now closed as I left the company. I could also get a larger lump sum and smaller income but due to pot 2 I am planning to take it this way as
Pot 2 (current employer) is the defined contribution type. When i reach 66 (I am 51) it is forecast to be worth approx 100k.
With pot 2 when the time comes am I right to think that I could take pot 1 as a small lump sum and 13k pa plus take 25% of pot 2 and ‘draw down’ the remainder of pot 2 at whatever amount i want until the pot is empty?

If so by my reckoning I would have an income at 66 of 13k pa, plus lump sum of 25k from pot 2 (and a small lump sum from pot1) plus say 7.5k pa drawdown from pot 2 for 10 years, plus 7.5k pa widow pension (at todays rate, obvs it’ll be bigger in 15 years), plus state pension (at 67) of about 9k pa.

IF I’m correct I’ll be miles better off than I am now, plus my mortgage will be gone then as well..?

 

[SWP's back]

Quick question for those who understand these things.

I am fortunate enough to have 2 pension pots, plus another widows pension (currently 7500 pa and index linked each year).

One from a previous employer is forecasted to pay me a annuity of 13000pa as well as a smaller lump sum. This is a final salary scheme and is now closed as I left the company. I could also get a larger lump sum and smaller income but due to pot 2 I am planning to take it this way as
Pot 2 (current employer) is the defined contribution type. When i reach 66 (I am 51) it is forecast to be worth approx 100k.
With pot 2 when the time comes am I right to think that I could take pot 1 as a small lump sum and 13k pa plus take 25% of pot 2 and ‘draw down’ the remainder of pot 2 at whatever amount i want until the pot is empty?

If so by my reckoning I would have an income at 66 of 13k pa, plus lump sum of 25k from pot 2 (and a small lump sum from pot1) plus say 7.5k pa drawdown from pot 2 for 10 years, plus 7.5k pa widow pension (at todays rate, obvs it’ll be bigger in 15 years), plus state pension (at 67) of about 9k pa.

IF I’m correct I’ll be miles better off than I am now, plus my mortgage will be gone then as well..?

Sounds about right mate yeah based on what you’ve said.

Though double check the SRA (standard retirement age) of Pot 1 as I’d be surprised if it’s as late as 66, most DB’s are 60 or 65.

 

[Kazzydeyna]

Sounds about right mate yeah based on what you’ve said.

Thank you for the reply. Just got to eat shit for the next 15 years and then fingers crossed I'll be in good enough health to spend my pension on hookers and coke for a good ten years.
I'll probably waste the rest.