Pension pittance - best way forward

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purple_window_shopper
purple_window_shopper Posts: 37 Forumite
in Pensions, annuities & retirement planning
Hi, my husband has had a few jobs over the years, he is quite 'relaxed' when it comes to sorting out his pension so I am doing some research to push him along!
He has 3 company pensions, none of which have a great deal in them. He also worked at a company for two years without any pension and has just taken a new job which doesn't have a pension scheme.
My husband is now 56 and I would we really need to sort out our finances but I have no idea where to start with the pensions.
1. Is it worth collating the three pensions he has?
2. How do I go about it?
3. Is it better putting it into some sort of savings plan?

Any advice gratefully received!
Thanks
Doing my best :doh:
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  • xylophone
    xylophone Posts: 44,412 Forumite
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    has just taken a new job which doesn't have a pension scheme.

    https://www.gov.uk/workplace-pensions/joining-a-workplace-pension

    By 2018 all employers must provide a workplace pension scheme. This is called ‘automatic enrolment’.
    Is it worth collating the three pensions he has?

    What type of pensions are they?

    His (and your) state pension?

    https://yourstatepension.campaign.gov.uk/?utm_source=Mail-Online&utm_medium=Partnership&utm_campaign=GTKY

    Does he need professional advice?

    https://directory.moneyadviceservice.org.uk/en
  • GDB2222
    GDB2222 Posts: 24,665 Forumite
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    purple_window_shopper wrote: »
    1. Is it worth collating the three pensions he has?


    You could look at how they are invested, what the charges are, what the early surrender discount is, if any. If you have to pay someone for advice, it might not be worth it. If you can do it yourself, with free advice from here, it might be.

    Simply collating the pensions for the sake of tidiness, without making the analysis, could diminish value.
    No reliance should be placed on the above! Absolutely none, do you hear?
  • dunstonh
    dunstonh Posts: 116,371 Forumite
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    1. Is it worth collating the three pensions he has?
    2. How do I go about it?
    3. Is it better putting it into some sort of savings plan?

    1 - It is vital to know what you have and what it is going to do. Consolidation may or may not be suitable but until you know what they are, you are never going to know
    2 - Either do it yourself or use a local IFA.
    3 - Almost certainly not. Pensions are tax efficient and get tax relief. The investments you would typically use in a pension would be expected to significantly outperform cash savings.
    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.
  • LHW99
    LHW99 Posts: 4,215 Forumite
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    With regard to your point 3, although he could access the pensions now, it would trigger a tax charge if he took more than the tax-free lump sums, so could push him into higher rate tax, depending on the amount(s).
    Also, if he took more than the tax free amount from a DC pension, it would limit the amounts he could put in a pension going forward.
    If any of the pensions are DB, then he would probably need advice to transfer which would be costly.
  • purple_window_shopper
    purple_window_shopper Posts: 37 Forumite
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    xylophone wrote: »
    https://www.gov.uk/workplace-pensions/joining-a-workplace-pension

    By 2018 all employers must provide a workplace pension scheme. This is called ‘automatic enrolment’.

    Apparently it's a newish company and they don't have to do it he 😕. I think it's the kind of company that will not do it until it is forced into it. It's a small, local company.

    What type of pensions are they?
    I am embarrassed to say I don't know. He never reads the letters or updates (I know-shocker,) so I am trying to sort it out. I will have a read through them. They are all from large corporate companies.

    His (and your) state pension?
    I have been a Carer for 30 years so don't have a work pension, just one tied to careers allowance.

    https://yourstatepension.campaign.gov.uk/?utm_source=Mail-Online&utm_medium=Partnership&utm_campaign=GTKY

    Does he need professional advice?
    HELL YES. Thanks I will take a look at the links.

    https://directory.moneyadviceservice.org.uk/en

    Thanks for take BG the time to reply. 😊
    Doing my best :doh:
  • AnotherJoe
    AnotherJoe Posts: 19,622 Forumite
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    purple_window_shopper wrote: »
    Hi, my husband has had a few jobs over the years, he is quite 'relaxed' when it comes to sorting out his pension so I am doing some research to push him along!
    He has 3 company pensions, none of which have a great deal in them. He also worked at a company for two years without any pension and has just taken a new job which doesn't have a pension scheme.
    My husband is now 56 and I would we really need to sort out our finances but I have no idea where to start with the pensions.
    1. Is it worth collating the three pensions he has?
    2. How do I go about it?
    3. Is it better putting it into some sort of savings plan?

    Any advice gratefully received!
    Thanks

    Point 3 absolutely not, but really your questions are rearranging the deckchairs, main priority whilst he is earning is to maximise the tax relief he can get into a pension, I assume he is on basic rate tax but even so the payback is much better than he will get in any other way.

    How many years does he intend to Work? And what about you , what are you doing ?
  • purple_window_shopper
    purple_window_shopper Posts: 37 Forumite
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    Hi Another Joe
    yes he is paying basic rate tax, as for retirement, the sooner the better as far as he is concerned! He is 57 this year.
    I receive careers allowance for my son and support for my dad (81) since my mum died.
    Thanks
    PS sorry about the gobbledygook on my other post, the perils of auto correct. Proofread! 😂
    Doing my best :doh:
  • Alice_Holt
    Alice_Holt Posts: 5,949 Forumite
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    AnotherJoe wrote: »
    really your questions are rearranging the deckchairs, main priority whilst he is earning is to maximise the tax relief he can get into a pension,...

    Totally agree with this.

    https://www.pensionsadvisoryservice.org.uk/about-pensions/pensions-basics
    https://www.moneyadviceservice.org.uk/en/articles/when-and-where-to-get-pensions-help-and-advice
    https://www.moneyadviceservice.org.uk/en/articles/pension-wise

    https://www.theguardian.com/money/blog/2017/apr/22/save-40-a-week-retirement-which-report

    As suggested start with both your SP forecasts and see if what additional money you would need to survive during retirement.
    Alice Holt Forest situated some 4 miles south of Farnham forms the most northerly gateway to the South Downs National Park.
  • AnotherJoe
    AnotherJoe Posts: 19,622 Forumite
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    purple_window_shopper wrote: »
    Hi Another Joe
    yes he is paying basic rate tax, as for retirement, the sooner the better as far as he is concerned! He is 57 this year.
    I receive careers allowance for my son and support for my dad (81) since my mum died.
    Thanks
    PS sorry about the gobbledygook on my other post, the perils of auto correct. Proofread! 😂

    I assume you do not have income from employment then ?
    Are you paying £2,880 into a pension each year ? That will give you a free £720.
    You can do this every year until you are 75.
  • purple_window_shopper
    purple_window_shopper Posts: 37 Forumite
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    AnotherJoe wrote: »
    I assume you do not have income from employment then ?
    Are you paying £2,880 into a pension each year ? That will give you a free £720.
    You can do this every year until you are 75.

    No I am not in paid employment and I am embarrassed to say I have no idea about the pension. When I say I am clueless I mean I am truly and absolutely clueless, although I am trying to rectify that now. 😕
    Doing my best :doh:
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