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Pension take or leave?
- Thread starter Stammo
- Start date
Hard to see,past 25% tax free BUT only if you are going to do something with it.
Interest rates remain pathetic for savers.
A good IFA will pay for themselves (there are some out there) unless you plan to spend it!
Interest rates remain pathetic for savers.
A good IFA will pay for themselves (there are some out there) unless you plan to spend it!
noobie
Clueless in most things
Same dilema for next December. It's a public service pension and the statement for the last few years has shown little more than £500 increase per year over the last 4 years. I am looking into pulling it all out, surrendering the whole thing and then looking to invest either in entry level property, either cheap housing or holiday homes/mobile home or just spunking the lot by ticking many parts of my bucket list.
I still have a private pension also. The next 12 months will be a lot of reading up before I decide.
I still have a private pension also. The next 12 months will be a lot of reading up before I decide.
Stammo
Registered User
Property is OK and does provide a rental income which however is taxable, plus if you sell, you pay CGT on the profit. 17pc from next year, so you gotta think carefully... You can borrow against the first property to buy another, which might reduce taxable profit from the first one.
Or as you say you could just bucket list it... You never know what's around the corner as my good lady found out two years ago when she was diagnosed with cerebral ataxia.
Or as you say you could just bucket list it... You never know what's around the corner as my good lady found out two years ago when she was diagnosed with cerebral ataxia.
The general rule with pensions is do not take them until you need them. One can take 25% of the fund tax free currently. Once you take the taxfree cash you have taken it. So if your fund continues to grow you will pay tax on all that extra growth. Please be aware I am not giving advice, just generic information. Make an appointment with at least two IFAs and see what they have to say. A good IFA will save you making silly mistakes, as Andy says. IFAs are so tightly regulated now it would be unlikely one will give you bad advice. Do not take FREE advice. Good advice is a valuable commodity. Pay for it and you will save in the long run.
Property can be good but it is not without pitfalls. Paying 10 or 12% of the rental to a good agent is to my mind a very sensible move. Despite rumours to the contrary the value can (and does) go down as well as up. Tenants can be a nightmare and the law seems stacked in their favour. I would never advise anyone to have a mortgage on an investment property unless they can afford,to pay it if the rental stops for any reason - seen so many come unstuck.
I have a friend who has a number of Houses of Multiple Occupancy - the financial,return is very good but his life is a misery running round after idiot tenants and their slag behaviour.
Don't let me put anyone off though....it can be smooth, trouble free and profitable!
I have a friend who has a number of Houses of Multiple Occupancy - the financial,return is very good but his life is a misery running round after idiot tenants and their slag behaviour.
Don't let me put anyone off though....it can be smooth, trouble free and profitable!
Steve Ashby
Registered User
My accountant just gave me a look and said, "Better in your account than theirs".
That's why he is an accountant and NOT a financial adviser. I could write a book about bad advice given by accountants who are not qualified to give financial advice. Accountants are bean counters no matter how pleasant they are. Seems like amateurs night on here. With the new pension rules it is even easier to make catastrophic mistakes. FREE ADVICE IS USUALLY BAD ADVICE.
Quiney
Registered User
Trouble is , it's all crystal ball gazing!
One of my personal pensions, I had set at retirement age of 60. When I took it a few years back the annuity rate were (still are) crap. On the upside my heart condition did improve it - slightly.
But I could have taken it from the age of 50, albiet with a penalty. The annuity rates would have been in double figures back then, and I would have been drawing the income for an additional 10 years.
One of my personal pensions, I had set at retirement age of 60. When I took it a few years back the annuity rate were (still are) crap. On the upside my heart condition did improve it - slightly.
But I could have taken it from the age of 50, albiet with a penalty. The annuity rates would have been in double figures back then, and I would have been drawing the income for an additional 10 years.
Generic advice! Once you take an annuity the rate is set. (Usually) New rules make taking an annuity, except in exceptional circumstances, a bad deal. Annuity rates are based on gilt rates which are tied to the BOE set interest rate. Annuity rates in 1970 meant a man of 65 with £100K in his fund would get 13K a year pension, now he would get about £6k.
Steve Ashby
Registered User
Seems like professionals night on here. 
Touché!
Not any more, just an expert in the field of good common sense when it comes to money.
Especially if it is mine!!
Also,the rules on investment properties are mid way through a change process to make it less rewarding for landlords.
Who will pass the costs on to tenants.
Who will pay higher rents.
Great way of solving the housing crisis, with 13 million people projected to be renting by 2020.
Who will pass the costs on to tenants.
Who will pay higher rents.
Great way of solving the housing crisis, with 13 million people projected to be renting by 2020.
I would advise caution though I cannot fault your generic comments. It is now a criminal offence to offer advice if one is no longer or has never been qualified. Two accountants of clients of mine are currently rueing unlicensed pension advice they gave. My clients lost a ruck of money which the accountants have repaid but they are still facing criminal charges. Pensions is THE hot potato currently. The adviser I work with who is servicing my clients treads VERY carefully especially when someone walks in off the street seeking pension vesting advice.
Quiney
Registered User
It was a unitised with profit. So it was the terminal bonus.Slight amendment, Quiney.
(I was an authorised advisor in a previous life!)