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  • FIRST POST
    • RedTed123
    • By RedTed123 10th Feb 18, 11:45 AM
    • 2Posts
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    RedTed123
    Rainbow Personal Pension
    • #1
    • 10th Feb 18, 11:45 AM
    Rainbow Personal Pension 10th Feb 18 at 11:45 AM
    First time on so here goes.
    I have a private pension from the 80s/90s that I no longer contribute to. It is now managed by Friends Life/Aviva and the surrender value is about £22,000.
    I want to take income drawdown option and take the 25% tax free option but am unsure as to what will be the best option for me.
Page 1
    • Tcquins
    • By Tcquins 10th Feb 18, 11:54 AM
    • 30 Posts
    • 18 Thanks
    Tcquins
    • #2
    • 10th Feb 18, 11:54 AM
    • #2
    • 10th Feb 18, 11:54 AM
    Hi RT,

    Check whether its got any guarantees - (protected tax free cash greater than 25%, guaranteed annuity rates).

    Its unlikely that they will be able to facilitate just the 25% tax free lump sum option, so you need to check whether it needs to be transferred to a more modern product to do this.

    The next question, is why do you want to draw it out? Is it ultimately just because its there? Pension plans are useful to keep from a tax planning perspective (outside of the estate for IHT, die before 75; your beneficiaries can take money from the pot tax free as and when they like).
    • RedTed123
    • By RedTed123 10th Feb 18, 12:23 PM
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    RedTed123
    • #3
    • 10th Feb 18, 12:23 PM
    • #3
    • 10th Feb 18, 12:23 PM
    I am a little short and need to free up some tax free cash but need some advice as to where to invest the rest etc
    • zagfles
    • By zagfles 10th Feb 18, 1:47 PM
    • 12,720 Posts
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    zagfles
    • #4
    • 10th Feb 18, 1:47 PM
    • #4
    • 10th Feb 18, 1:47 PM
    Have a chat with pensionwise https://www.pensionwise.gov.uk/en
    • xylophone
    • By xylophone 10th Feb 18, 2:12 PM
    • 24,441 Posts
    • 14,312 Thanks
    xylophone
    • #5
    • 10th Feb 18, 2:12 PM
    • #5
    • 10th Feb 18, 2:12 PM
    You can book a personal appointment with Pensionwise to discuss your options.

    You may find that Aviva will not facilitate the drawdown option.

    One possibility could be to transfer to a SIPP with Hargreaves Lansdown.

    This would enable you to take your PCLS.

    You could leave the £16000+ in the SIPP in cash and pay no charges.

    You could choose to invest it (for which a charge is made) but it would be very modest on this modest amount.

    You could then draw down the remainder (which is taxed as income) at a time that suits but avoid closing the SIPP within a year as there is a closure charge.

    http://www.hl.co.uk/partners/search/sipp?theSource=PCHLS&Override=0&adg=G+HLBS+HLS&gcl id=EAIaIQobChMI7MTUkc!!!QIVwrDtCh0V5Qg-EAAYASAAEgILHPD_BwE
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