Pension take or leave?

[Centaur]

It was a unitised with profit. So it was the terminal bonus.
(I was an authorised advisor in a previous life!)

Prudential, Pearl, or Co-op?

 

[Quiney]

Barclays Bank then Guardian Royal Exchange or Guardian as it became.

 

[andyBeaker]

Seriously folks please pay for good advice on pension. You spent years building it up and there is now the potential to f*ck up good style. I completely approve with the pension freedoms people now have but the dangers are massive and mistakes irretrievable.

Yeah, but at least you can buy a Lamborghini now!!

 

[Squag1]

I hit the magic 55 soon, so do I take my 25% tax free or leave it in the pot. I don't need to take it, just wondered what folk wiser than me might think...

25% of a big number is more than 25% of a small number.

 

[johnboy]

Another crystal ball question is, how long are you expecting to live? Now we all hope for a long and healthy older age but, for example, both your parents died early with cancer then I guess there is a high chance you could go early too, in which case cash in and spend big. By the same token if both your parents are still going strong at 90 plus then you might just be around for the long haul. It really is pot luck.

 

[andyBeaker]

Another crystal ball question is, how long are you expecting to live? Now we all hope for a long and healthy older age but, for example, both your parents died early with cancer then I guess there is a high chance you could go early too, in which case cash in and spend big. By the same token if both your parents are still going strong at 90 plus then you might just be around for the long haul. It really is pot luck.

Good shout - I had a choice of a juicy redundancy package and a reduced pension or the statutory minimum redundancy and a full pension ;. Instinct at the time was to take the juicy redundancy but it is essential to do the sums. Turned out I only needed to live another eight years after taking everything (including tax) into,account to be ahead on.a full pension. My brother died at 54 so you really have to think it through and decide what your priorities are. Also,think about the impact on your partner if you keel over.

 

[Minkey]

I'm not an expert but when you reach retirement age won't the 25% of a pension pot be greater than at 55? That's why I left mine where it was

 

[Stammo]

In theory it should be, but who knows in these challenging times... Even good IFAs can only guess.

 

[ricko]

I spoke to several IFA's about my choices when planning to retire early. Half of them were clueless when it came to tax planning ... I ended up with a mix of their ideas and my own, working out well so far.

 

[mr john]

When looking for an IFA make sure they are a pension speecialist many "good" IFAs are lacking when it comes to pension knowledge

 

[Centaur]

Can't get the help nowadays! Some "specialists" can be too exotic in their solutions. Always remember it is your long term hard earned and not theirs.

 

[noobie]

Decide to revisit this as part still confuses me. I've re-read the thread and am aware no one can offer me specific advice but hope someone can clarify or give what they understand just what is a surrended pension or some suggestions.

So I'll use an example, my small pension I'm expecting to consider at the end of the year. The statement claims I will have a £21,983 lump sum with a £7,327 annual pension. Now I've read that most pensions use as a guide that men's average age at death is around 85.

Therefore if I was to sell the pension, am I using the wrong method adding it up? To think 30 years (55-85) at £7,327= £219,810 plus the lump sum of 21,983 gives me a total of £241, 793.

Whilst that is the right number, surely that isn't the amount I'm surrendering to a pension company and if it is what is the average buy back? i.e. if that total is correct what on average would the company buy the pension for, again not looking for exacts just a general idea and if I'm barking up a wrong tree here

I know to those in the financial market will probably think daft twat but genuinely when someone says sell your pension, there isn't a lot of information on just what you are going you to sell to them?

 

[Centaur]

Noobie, it is a criminal offence for someone unlicensed to give financial advice......even on here. FREE ADVICE IS BAD ADVICE! Go see two or three independent and I stress Independent Financial Advisers. The first interview will be free so you can get a good idea of their competence. Then chose one to give advice. They will complete a fact find, establish your attitude to risk and then having looked carefully at your situation they will put their advice in WRITING! Remember they are financially responsible for the advice they give and have professional indemnity insurance. You do not have to take that advice and can go elsewhere to compare. It will cost you for the advice but will stop you making bad choices. The type of company scheme you currently have and the employer's record of topping up in retirement is just the first consideration. Beyond that it can go a dozen ways so please go and get professional advice. IFAs are so heavily regulated now that many will not touch pension advice as it is so complicated and if they get it wrong it will come back and bite them in the ass. I was for years a pension specialist and can tell you some of the bits and pieces people have said in this thread are well meaning but only reflect their situation and not yours. Stop posting on here and get good advice.

 

[noobie]

I appreciate your response Bill and also appreciated no one could give an official answer. I suppose my hope was more to ask if anyone knew what the standard formula was and used my own situation as an example. I.e. is it all added up as a total or just one year or 5 year etc. so I was after generic advice and not specific

I will get specialist advice when the time comes but I had hoped to get not the numbers of the formula but the method of the formula, never mind. Thanks again though for the reply.

 

[andyBeaker]

Ignore Centaur.

Buy a Lamborghini.

 

[Centaur]

Ignore Centaur.

Buy a Lamborghini.

Sounds like a good choice. The steering wheel came off one I hired in Stockholm.

 

[Centaur]

I appreciate your response Bill and also appreciated no one could give an official answer. I suppose my hope was more to ask if anyone knew what the standard formula was and used my own situation as an example. I.e. is it all added up as a total or just one year or 5 year etc. so I was after generic advice and not specific

I will get specialist advice when the time comes but I had hoped to get not the numbers of the formula but the method of the formula, never mind. Thanks again though for the reply.

You are making an assumption on the amount your pension will be worth on transfer. That figure is decided by your pension fund administrators and not as you calculate it. Companies willing to accept that transfer will all use their own calculations based on their charges and their annuity rates. Honestly Noobie, don't waste your time.

 

[Quiney]

Decide to revisit this as part still confuses me. I've re-read the thread and am aware no one can offer me specific advice but hope someone can clarify or give what they understand just what is a surrended pension or some suggestions.

So I'll use an example, my small pension I'm expecting to consider at the end of the year. The statement claims I will have a £21,983 lump sum with a £7,327 annual pension. Now I've read that most pensions use as a guide that men's average age at death is around 85.

Therefore if I was to sell the pension, am I using the wrong method adding it up? To think 30 years (55-85) at £7,327= £219,810 plus the lump sum of 21,983 gives me a total of £241, 793.

Whilst that is the right number, surely that isn't the amount I'm surrendering to a pension company and if it is what is the average buy back? i.e. if that total is correct what on average would the company buy the pension for, again not looking for exacts just a general idea and if I'm barking up a wrong tree here

I know to those in the financial market will probably think daft twat but genuinely when someone says sell your pension, there isn't a lot of information on just what you are going you to sell to them?

Far too simplistic. Your missing out compound interest, indexing of pension, widows pension, tax on part of the lump sum etc etc
Get yourself some good advice from some properly qualified.

 

[andyBeaker]

A low mileage Ferrari F430 is pretty decent value at the moment.

 

[Centaur]

T They are very pretty, Andy.