Withdrawing pension before 55 to invest?

Eric_the_half_a_bee wrote: »

Sorry, but I would not want to use a mortgage adviser who did not understand pensions and investments.

Would you use a podiatrist that had little knowledge of brain surgery?

Mortgage advisers are supposed to know about mortgages, and a passing knowledge of life insurance also helps. They certainly don't need to know pension legislation.

In any case the OP isn't even a mortgage adviser, he's a manager.

Malthusian wrote: »

Would you use a podiatrist that had little knowledge of brain surgery?

Mortgage advisers are supposed to know about mortgages, and a passing knowledge of life insurance also helps. They certainly don't need to know pension legislation.

Two couples in their early 50s come to you for advice on a £400k mortgage. One couple has pensions and ISAs valued at £3m; the other couple has no pensions or investments.

Would you give the same mortgage advice to both couples?

Eric_the_half_a_bee wrote: »

Two couples in their early 50s come to you for advice on a £400k mortgage. One couple has pensions and ISAs valued at £3m; the other couple has no pensions or investments.

Would you give the same mortgage advice to both couples?

Which one do you think I should not recommend the most competitive lender to?

I'm assuming the first couple has their reasons for not being cash buyers as otherwise this is going to be a short meeting.

The information given only affects the mortgage advice if the first couple qualifies for a more competitive mortgage due to meeting affordability requirements, or would benefit from an offset mortgage, however the only knowledge I require to give correct mortgage advice is that they have a lot of money, I still don't need a detailed knowledge of pensions legislation.

My experience of mortgage advisors is they are not there to advise on whether buying a house is a good idea, or how you should go about buying a house. You ring them up and you say I need a mortgage.

That is it.

but they don't really advise about whether you should go for say a 2 year fix or a 5 year fix (other than pointing out the differences between the two).

Actually, they should cover that bit off. Sometimes it is guidance (as more than one method often works) but they are also responsible for making sure the deal you select is appropriate. e.g. if you say you are moving in 3 years and they arrange a 5 year fixed, then that would be a failure that would see a complaint go against them. Or if you say you are looking for certainty of payment amount, then they should arrange a fixed etc.

They should record enough info in their factfind to allow them to filter many of the options down.

They are not financial planners though as has been said.

McDizzle wrote: »

Hi all,

I have good overall financial knowledge as I manage a team of mortgage advisors but I have little experience of pensions and investments so could do with some help if possible.

I have been told that it may be possible to withdraw 55% of your pension pot (whenever you like not just after age 55) to buy a property and use that property as part of your retirement plan.

Can anyone shed any light on whether this is an option and if so some of the conditions that may apply.

For example, let's say you can do this and I buy a property to rent out. Does all of the rental income have to be reinvested into my pension pot or could this be used to as part of my normal income to spend on what I like?

Thanks in advance.

Sorry but what i think you mean there is "i can do sums and work out interest payments and commission well"

Everything you say after that first paragraph shows that you do not have good financial knowledge.

Your thread title is " Withdrawing pension before 55 to invest?" but your pension IS invested !

As said by others its illegal to withdraw it before 55, but even if you were 55 unless you were heading for well over a million in your pension, it would still in be a completely insane and financially utterly inept thing to take your pension money and buy any investment with it, let alone a house.

This is before you even get into the recent changes about BTL and taxation making it much less profitable (in some cases not even marginally profitable.

And thats before you look at the risk aspect of a single investment (house).

Stick to your mortgage advising and spend a year or two learning about pensions and then maybe you can look at how the investments in your pension are doing. I'd recommend the Monevator website.

**let's try to keep the forums a friendly place** Forum Team