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Change IFA or just do without one?
Comments
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Blue_Parrot wrote: »Why is that largely irrelevant, since it's performing better than we thought it would (in the absence of any information)?
It is not the pension that has made the money. it is the investment that has. So, you could have a cheaper plan with the same or similar investments.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
Will your husband be drawing his state pension in single tier?
https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/181237/single-tier-pension-fact-sheet.pdf0 -
Well you have missed a trick here!!!
Why, if you are still working, are you not deferring your SP? It would get an uplift of 10.4% for each year deferred? so get deferring it now. Can't see you getting 10.4% for it in the bank, can you?
No! I have not missed a trick here! It's very simple.
By taking the pension every 28 days (13 times a year) I can put it wherever I want (it all goes into an ISA) and it forms part of my estate should I predecease my husband. Had I opted to defer it, those thousands of pounds already paid to me, would not be available to him should I have predeceased him. They do not pay State Pension posthumously!
I wouldn't advise anyone to defer their State Pension on those grounds alone, but you can if you want to.
Also, once one has decided to take it, one cannot switch to deferring it - just FYI.
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Will your husband be drawing his state pension in single tier?
https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/181237/single-tier-pension-fact-sheet.pdf
Thanks for that link, I've had a look at it.
It doesn't include Additional State Pension (which increases every year), and I have a pension forecast for him from 2011.0 -
Blue_Parrot wrote: »No! I have not missed a trick here! It's very simple.
By taking the pension every 28 days (13 times a year) I can put it wherever I want (it all goes into an ISA) and it forms part of my estate should I predecease my husband. Had I opted to defer it, those thousands of pounds already paid to me, would not be available to him should I have predeceased him. They do not pay State Pension posthumously!
I wouldn't advise anyone to defer their State Pension on those grounds alone, but you can if you want to.
Also, once one has decided to take it, one cannot switch to deferring it - just FYI.
You can defer after taking it, deferral can be undertaken two times.
The return on your isa will be what 2%, as opposed to 10.4% for deferral. There is a risk that you won't claim before death or not get the full benefit but there is risk in anything, and probability suggests that deferral for a short period, typically 1 to 4 years, is advantageous for most.
For comparison annuity rates would offer index linked rates not exceeding around 4-5% at best, so deferral is best for many.
The whole point of these forums is to exchange information and learn about approaches and techniques which match individuals needs against their risk tolerance. You don't seem to want to learn from a relatively uninformed basis which is your choice but why ask questions when you don't want to hear the answers?0 -
Blue_Parrot wrote: »No! I have not missed a trick here! It's very simple.
By taking the pension every 28 days (13 times a year) I can put it wherever I want (it all goes into an ISA) and it forms part of my estate should I predecease my husband. Had I opted to defer it, those thousands of pounds already paid to me, would not be available to him should I have predeceased him. They do not pay State Pension posthumously!
I wouldn't advise anyone to defer their State Pension on those grounds alone, but you can if you want to.
Also, once one has decided to take it, one cannot switch to deferring it - just FYI.
FYI you are wrong, you can defer it.
If you are likely to die in 1-2 years, by all means take the money and save it at 1% or whatever, and watch it dwindle with inflation- you can if you want to.
I'd be deferring unless I had an illness that shortened my LE.0 -
The whole point of these forums is to exchange information and learn about approaches and techniques which match individuals needs against their risk tolerance. You don't seem to want to learn from a relatively uninformed basis which is your choice but why ask questions when you don't want to hear the answers?
Hi bigadaj
I didn't ask a question about State Pension/s......... and thanks for calling me 'relatively uninformed'. :beer:0 -
FYI you are wrong, you can defer it.
If you are likely to die in 1-2 years, by all means take the money and save it at 1% or whatever, and watch it dwindle with inflation- you can if you want to.
I'd be deferring unless I had an illness that shortened my LE.
No one know when they're going to die: my sister died at age 54 and my brother at age 51 (from completely unrelated causes). I'd rather have the State Pension now and do whatever I want with it. Neither of them lived long enough to make decisions like that - something one bears in mind, FWIW. :beer:0 -
Blue_Parrot wrote: »Hi bigadaj
I didn't ask a question about State Pension/s......... and thanks for calling me 'relatively uninformed'. :beer:
No problem, but your state pension is a factor in your overall financial make up.
I was being surprisingly generous in the relatively uninformed quote, you've dismissed all comment so would be best following your own course of action, I would advise you using an ifa but I think you would be a difficult client.0 -
With respect to state pension deferral you'll probably find that you can do better by buying term life insurance on your own life and deferring. The insurance cost is likely to be considerably less than the longer term gain from the deferral.
As an example, this is a quote I just got from Aviva for covering five years of deferral of £6,000 a year of state pension for a 63 year old woman, covering all £30,000 from the first day:
Your monthly payment: £14.63
The person covered: Female Never smoked Born 28/06/1951
Amount of cover: £30,000
How long cover will last: 5 years
So in this example £175.56 a year will let you gain £624 a year of increasing with inflation of future income per year of deferral. A shorter duration would have a lower monthly premium.
You should use more than five years to cover the time until the extra income from deferral has covered the lost income in the meantime. That can probably be done most efficiently with a series of policies:
Start of year one: £6,000 of cover for 15 years
Start of year 2: £12,000 more of cover for 10 years
Start of year 4: £12,000 more of cover for 4 years. Optionally adjust for inflation-linked increases.
That should roughly match or exceed the accumulated and unpaid amounts at each point from the start until all of the missed money has been paid out in extra pension. I've ignored inflation-linked increases, those reduce the payback time and duration of insurance required. I also ignored the cost of the insurance which extends it a bit.0
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