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  • FIRST POST
    • another casualty
    • By another casualty 12th Mar 17, 9:02 PM
    • 2,827Posts
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    another casualty
    Would like to open a sipp ..many questions ..
    • #1
    • 12th Mar 17, 9:02 PM
    Would like to open a sipp ..many questions .. 12th Mar 17 at 9:02 PM
    Howdy

    I'm in a strange situation right now . I'll try to be as brief as poss:

    I have money to put into a sipp right now, from the sale of flat .

    I have 3 pensions already , although I've never been on a great wage over the years, just plodding along.

    One of the very nice people on the debt free wannabee forum , says
    I haven't got much time to get sipp organised , due to the tax year end ?

    I've been on a company pension with my last company for roughly 6 years. This company moved the pension fro standard life , to argon , and finally Hargreaves land down . (Same pension , just moved for reasons too complicated to reason why )

    I am currently unemployed since mid November , where I started my life all over again. The last pension payment to Hargreaves went through in November .

    That's more or less , the information I have thus far.

    Questions are : do I qualify for sipp ? If so, how much am I allowed to contribute as a lump sum? How do I actually start the sipp?
    Or, do I transfer from my recent pension from Hargreaves instead. ?

    Please bear in mind: I am not currently working . I'm not well enough to work just yet . I have not signed on for employment benefit yet.
    ( ignore the work side of things as its a pension forum I'm on )

    I intend to use this sipp if successful as being able to draw up to 25% from the age of 55 which I will be in December .

    Thanks
Page 1
    • NoMore
    • By NoMore 12th Mar 17, 9:09 PM
    • 143 Posts
    • 117 Thanks
    NoMore
    • #2
    • 12th Mar 17, 9:09 PM
    • #2
    • 12th Mar 17, 9:09 PM
    http://forums.moneysavingexpert.com/showpost.php?p=72239363&postcount=4446


    This I believe is the post the OP is referring to, just to make it clear for everyone what he was told previously.
    • another casualty
    • By another casualty 12th Mar 17, 9:10 PM
    • 2,827 Posts
    • 4,448 Thanks
    another casualty
    • #3
    • 12th Mar 17, 9:10 PM
    • #3
    • 12th Mar 17, 9:10 PM
    Yes it was ! Thanks no more
    • bigadaj
    • By bigadaj 12th Mar 17, 9:17 PM
    • 9,587 Posts
    • 6,101 Thanks
    bigadaj
    • #4
    • 12th Mar 17, 9:17 PM
    • #4
    • 12th Mar 17, 9:17 PM
    You're limited to your earnings, effectively employment, for the tax year, so that is a good starting point.

    Hargreaves lansdown offer a sipp, it's not the cheapest but their customer service is good.
    • another casualty
    • By another casualty 12th Mar 17, 9:26 PM
    • 2,827 Posts
    • 4,448 Thanks
    another casualty
    • #5
    • 12th Mar 17, 9:26 PM
    • #5
    • 12th Mar 17, 9:26 PM
    You're limited to your earnings, effectively employment, for the tax year, so that is a good starting point.

    Hargreaves lansdown offer a sipp, it's not the cheapest but their customer service is good.
    Originally posted by bigadaj
    Thanks

    I was fully employed until November . Also permanent employment unbroken since before I started pension. As my last pension was with Hargreaves,I don't mind if it costs a little more .
  • jamesd
    • #6
    • 12th Mar 17, 9:39 PM
    • #6
    • 12th Mar 17, 9:39 PM
    Get your P45 and note the total taxable pay in this employment number for the current tax year. Check HL online for your gross contribution this tax year and subtract that. Multiply the result by 0.8 and that is the net you can pay in this tax year.

    Give HL a call and tell them what you want to do and they will say whether you can add to the work one or need a new personal account. If you have a debit card around it might all be taken care of during that call, perhaps with you doing an online transfer from savings to current account during it.

    I've assumed that:

    1. Your pay was less than the £40,000 annual allowance or you have carry forward available from the last three years that is enough.
    2. That your adjusted earnings in 2016-17 did not exceed £150,000 making you subject to the annual allowance taper.

    Also note that the earnings used are those in the year of contribution to the pension, not the previous year. If you do go over the earnings limit HL can refund the excess as an untaxable refund of excess contribution lump sum and also reverse the tax relief given on it into the pension. Can do this within six years. Only applies to the income limit, go over the AA and you pay the similar Annual Allowance penalty charge to HMRC instead.

    The tax relief will be received in 2017-18 but that doesn't matter, just the date on which you paid in.
    Last edited by jamesd; 12-03-2017 at 9:55 PM.
    • another casualty
    • By another casualty 12th Mar 17, 9:52 PM
    • 2,827 Posts
    • 4,448 Thanks
    another casualty
    • #7
    • 12th Mar 17, 9:52 PM
    • #7
    • 12th Mar 17, 9:52 PM
    Thanks James
    The salary I was on , was just over £25 k .( sad by London standards)

    Being naive with pensions, I don't understand the adjusted earnings , that you mention . Sorry

    One thing that may be important in the scheme of things: most of my important paperwork is still in big yellow storage.
    I have p 45 / recent payslips . I'm still temporarily in rented accommodation . This means, all the Hargreaves lansdown stuff is in big yellow etc. I was so stressed out last year, I never went online to do the basics of a user name / password etc . Long story.

    I just found the business card of Hargreaves pensions guy , who visited the company last year. I was thinking of sending an email to him and the pensions person at previous place of employment .
  • jamesd
    • #8
    • 12th Mar 17, 9:58 PM
    • #8
    • 12th Mar 17, 9:58 PM
    P45 will do. Just give them a call and they will tell you what to do and how much you can pay in, since they know what you have paid in already.

    You can ignore adjusted earnings, and annual allowance, your pay wasn't high enough for them to matter.
    • another casualty
    • By another casualty 12th Mar 17, 10:05 PM
    • 2,827 Posts
    • 4,448 Thanks
    another casualty
    • #9
    • 12th Mar 17, 10:05 PM
    • #9
    • 12th Mar 17, 10:05 PM
    P45 will do. Just give them a call and they will tell you what to do and how much you can pay in, since they know what you have paid in already.

    You can ignore adjusted earnings, and annual allowance, your pay wasn't high enough for them to matter.
    Originally posted by jamesd
    Thanks again James .
    So you think it would be possible to transfer from that Hargreaves pension to a Hargreaves sipp ?
    I want to withdraw some money after 55 , and not 67
    • another casualty
    • By another casualty 13th Mar 17, 1:59 PM
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    another casualty
    Just before I phoned Hargreaves lansdown, I found an unopened letter. It tells me that the company pension I just left, is a sipp.
    Current sipp value £22,000( mixed investment bond and fixed interest funds £22,000)
    So I just phoned Hargreaves lansdown .
    I have had my head in the sand all of last yearn particular, as I was / am moving house . Lots of unopened letters etc.

    I will be sent a pin no. Hrough the post . The one I ignored expires on weds. I was going to make additional payment, but they have to take payment from the address that matches the address that they have .
    So basically I can update my records etc when I receive new pin no.

    So, I asked if i could I setup an additional sipp, or is it best to just put additional money into the one I already have.
    From what I gather, it seems best just to top up the one I have .

    However, I asked about the tax year . ( left co. In Nov last year)
    I'm not sure how much additional funds I am permitted .
    On my wage slips it says "pension sal sac -£87.75 to date £702.00

    I was thinking of putting in an additional £15,000

    As I say, what I would've thought would be better , is for me to have a separate sipp for£15,000 and ignore this one until I retire.

    Your thoughts ?

    Thanks
  • jamesd
    Add to the existing one. The gross value of what is in there so far for pension contribution pay limit is nil because salary sacrifice contributions count as coming from the employer, not the employee. So you can pay in net up to 0.8 times the "total pay to date" number on your P45 and 25% will be added to that to give you the 20% basic rate tax relief. You get that even on money that was within your income tax personal allowance.
    • AnotherJoe
    • By AnotherJoe 13th Mar 17, 5:14 PM
    • 7,054 Posts
    • 7,521 Thanks
    AnotherJoe
    FYI, the £15k will be topped up by another £3,750 but that will take a few weeks. If you look on the HL website there is a calendar that tells you the date it will appear in your account.
    • another casualty
    • By another casualty 28th Mar 17, 7:37 PM
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    • 4,448 Thanks
    another casualty
    Thanks Joe
    Because of my upheaval, I will have to get technical help tomorrow.
    My client no. Is not recognised . I didn't go online before as I just let my employers deal with it, while I had my head in the sand .

    By this time tomorrow, I should have paid some more money into it.

    While I'm here, I may as well disclose the small amount I have so far

    Estimated fund value at retirement in today's Money £49,000
    This could provide me with an estimated annual annuity income of
    £1,300
    That's my pension illustration

    My current sipp value ( mixed investment , bonds and fixed interest funds £22,084.82

    I have another pension, which is potentially smaller than this.
    ( from 1987-1991 / 1994- 1999, I worked twice in same company transferred to another company in 2000 when I changed jobs.That pension lasted approx 2 years max)
    The details of that are in storage , as I'm going through a flat move.
    Sorry to go on
    • mgdavid
    • By mgdavid 28th Mar 17, 9:19 PM
    • 5,183 Posts
    • 4,348 Thanks
    mgdavid
    The more the merrier; there's a natural tendency to ignore or mentally write off small bits of pension from years ago. But it's surprising how these often add up to make a far better outlook for retirement than at first expected.
    A salary slave no more.....
    • another casualty
    • By another casualty 29th Mar 17, 3:38 AM
    • 2,827 Posts
    • 4,448 Thanks
    another casualty
    Thanks mgdavid
    Yes, every penny counts .
    • another casualty
    • By another casualty 29th Mar 17, 10:52 AM
    • 2,827 Posts
    • 4,448 Thanks
    another casualty
    I just made a payment of £12,000 . Hmrc will add £3,000 to that .
    It's currently held as 'cash'. There were options where to invest , but I haven't a clue . Brexit happening today, adds to the confusion.
    • enthusiasticsaver
    • By enthusiasticsaver 29th Mar 17, 11:05 AM
    • 3,972 Posts
    • 7,140 Thanks
    enthusiasticsaver
    Make sure you write to all your previous pension providers AC with your new address. Many pension providers these days give you online access so you can go on to the website and get forecasts etc. Obviously until you are working again it will be tricky for you to invest loads but something to bear in mind for the future.

    I agree with mgDavid don't write off small pensions. I worked for a big bank for 7-8 years from 1978 after leaving college to 1985 when I went on maternity leave to have my first daughter. On leaving I received a letter confirming I had a Guaranteed minimum pension of £221 with deferred increases to be paid in 2020 when I am 60. Due to the fact it has been increasing by 8.5% per annum it will actually pay me £3860 per annum from then.

    I have also just opened my first SIPP too. It was much easier than I thought. Just invested £8k (I only work part time so limited in how much I can put in)and £2k appeared from HMRC on my Halifax SIPP account last week.
    Countdown to early retirement on 31.12.17 4.5 months to go.
    • enthusiasticsaver
    • By enthusiasticsaver 29th Mar 17, 11:11 AM
    • 3,972 Posts
    • 7,140 Thanks
    enthusiasticsaver
    I just made a payment of £12,000 . Hmrc will add £3,000 to that .
    It's currently held as 'cash'. There were options where to invest , but I haven't a clue . Brexit happening today, adds to the confusion.
    Originally posted by another casualty
    Choosing funds can be tricky. I use the Vanguard lifestrategy funds so it may be worth you doing some research on those. They are mixed asset funds divided between equities and bonds so a Vanguard Lifestrategy 100 is 100% equities and Vanguard Lifestrategy 20 is 20% equities and 80% bonds. I went for Vanguard lifestrategy 60 but everyone's situation is different. They are popular on this forum though so there is lots of information for you to read and think about your risk profile etc etc.

    The main thing is that you do not want to be pushed into a corner in withdrawing it when the markets are low so don't invest anything you may need access to in the foreseeable future. My general principle is buy low and sell high.

    So far Brexit seems to have boosted my investments which is weird.
    Countdown to early retirement on 31.12.17 4.5 months to go.
    • another casualty
    • By another casualty 29th Mar 17, 1:08 PM
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    • 4,448 Thanks
    another casualty
    Thanks enthusiastic
    Glad your pensions are going in the right direction .
    I was gonna say, that pensions are a necessary evil with complications. But then i realised that's what I say about solicitors and insurance
    Pensions are a necessity , but with complications .
    ( I think that sounds better )
    • enthusiasticsaver
    • By enthusiasticsaver 29th Mar 17, 6:38 PM
    • 3,972 Posts
    • 7,140 Thanks
    enthusiasticsaver
    Pensions are definitely not evil but can be complicated. I think for those of us who naturally shy away from stocks and shares it can be difficult to get your head round it plus the tax side of it. I am still learning.
    Countdown to early retirement on 31.12.17 4.5 months to go.
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