Cancelling an old pension

EdInvestor

Doesn't the term "pension" as opposed to "savings" give a clue that it's intended to provide retirement income and not a nest-egg?

Judging by the number of people who come onto this board asking if they can get money out of their pension, No.

I suspect that when people say they want a "pension" they mean that they want to start saving up so they will have money in their old age.

They don't mean that they wish ito invest within a very restrictive tax wrapper where they can't access any of the money until they are at least 50 and then have to buy an annuity - which is what a "pension" actually means.

It would appear that these people should have been advised to start accumulating their money in an ISA tax wrapper, not a pension tax wrapper. Perhaps it would help if the commissions paid on the two wrappers were the same.

dunstonh

It would appear that these people should have been advised to start accumulating their money in an ISA tax wrapper, not a pension tax wrapper. Perhaps it would help if the commissions paid on the two wrappers were the same.

You mean the current situation where ISAs pay more than pensions should be reversed?

whiteflag_3

EdInvestor wrote:

Judging by the number of people who come onto this board asking if they can get money out of their pension, No.

I suspect that when people say they want a "pension" they mean that they want to start saving up so they will have money in their old age.

They don't mean that they wish ito invest within a very restrictive tax wrapper where they can't access any of the money until they are at least 50 and then have to buy an annuity - which is what a "pension" actually means.

It would appear that these people should have been advised to start accumulating their money in an ISA tax wrapper, not a pension tax wrapper. Perhaps it would help if the commissions paid on the two wrappers were the same.

Ive never come across anyone who thinks pension means anything other than vehicle for saving for retirement. What i have found over the last few years is people asking if they can get their money out because they have seen dodgy adverts on TV telling them they can unlock their pension!

Its impossible for anyone to take out a pension and not be made aware either verbally, key features, policy documents, cooling off, report etc etc that they are tied in.

Ed -Can you outline the current commission levels on pensions and ISAs for our information?

Note for other readers

This is where no more posts from Ed will appear on this thread however there will be posts on other threads . I find asking Ed a direct question leads to this outcome.

EdInvestor

OK guys, you're saying that the reason these people got mis... sorry, chose to buy these unsuitable pensions which they subsequently want to cancel has got nothing to do with commission.

Care to diagnose the cause of it, then?

dunstonh

Who says they were mis-sold?

He took out a pension for his retirement and that is what he got.

whiteflag_3

EdInvestor wrote:

OK guys, you're saying that the reason these people got mis... sorry, chose to buy these unsuitable pensions which they subsequently want to cancel has got nothing to do with commission.

Care to diagnose the cause of it, then?

I think i did in my last post - care to answer my question re commission?

whiteflag_3

Edinvestor you wrote-

It would appear that these people should have been advised to start accumulating their money in an ISA tax wrapper, not a pension tax wrapper. Perhaps it would help if the commissions paid on the two wrappers were the same

Is it too much to ask for you to outline the levels of commission on both wrappers? You brought up the subject , your using it as a basis to back up your misselling claims , its therefore not unreasonable to ask you to make your information available?.

EdInvestor

whiteflag wrote:

I think i did in my last post

Hi whiteflag

You said

What i have found over the last few years is people asking if they can get their money out because they have seen dodgy adverts on TV telling them they can unlock their pension..

Most of the ads I've seen about pension unlocking mention it applies to people aged 50 or over pretty prominently.

Whereas the comments I'm referring to on MSE are apparently from much younger people who are wanting to cash in pensions to do things like put down a deposit on a home.

whiteflag_3

"Whereas the comments I'm referring to on MSE are apparently from much younger people who are wanting to cash in pensions to do things like put down a deposit on a home"

Are they! I cant remember any other poster putting their ages on! However, I trust youve been through all the other posts to check you are correct before posting the the above.

Assuming your post is correct then these youngsters will only have been "missold" their pensions recently and therefore going back to my earlier post I feel it would have been impossible for any adviser to sell a pension and the investor not be made aware a numerous occasions that they were entering a long term contract. For the last 17 years they would have been give a key features document warning them of the long term nature of the contract several times. Given that the these people use a computer to post queries is it unfair to assume they have a certain degree of intellect that would allow them to ask questions of their adviser and also be able to read as well!.

Your almost in danger of scoring an own goal on this one

So come on Ed why dont you back up your posts with evidence to support your anti IFa ramblings or do us all a favour ................

Its also quite sad that the original poster hasnt been back to thank/ comment / question any of the posters who have tried to help him.

IanH_3

13000 wrote:

Just a quick one really, I have an old pension that I only paid into for a year about 3 years ago. So it has about £1200 in it. Can I cash this in early to help me further reduce my debt as I am now in my Companies pension scheme.

It depends on what the state of the pension is at the moment. When you left the company, did you transfer it to the new scheme, or did you leave it in the old scheme, and let it become deffered? If it is deffered, then you should write to the trustees of the scheme (get contact info from the old HR if needed) and ask them if you can "trivially commute" the pension. Basically, it is legal for the scheme to allow you to take your contributions back out, if you were paying in for a short period of time. Whether the trustees decide to allow it depends on their discretion and on the wording of the Trust Deeds and Rules. If its possible, you most likely wont get company conts, just a refund of yours...they should let you know how much pretty quickly.

Is this wise (im 28 and I realise I need to start upping my payments soon) but this would help me further reduce my outstanding credit and bring forward my debt free date a bit

well its up to you....