Pension Question

FeeBeeKay

Hello - this may seem like a very daft question, so apologies if it is obvious or dopey.

I have a small amount invested in a personal pension with Friends Provident from a previous job (approx £12K as of today, but probably falling fast!) I haven't added to it as I am no longer working, and am paying a management fee for the pension as far as I can see from the statement I had received.

My question is this - is it possible to take my cash (or a proportion of it now) and cut my losses, rather than wait for another 25 years and end up getting a monthly pension which might cover the cost of a cup of coffee by then!!?

Many thanks for any advice anyone can add.

FeeBeeKay

Day_Trader

Hi FeeBee,

It is not possible to withdraw the funds as cash as a pension will see your money tied up till 50 (rising to 55). There are however options available to you. If it is performing poorly then you can either do an internal fund switch or, if options in that respect are limited, you can transfer to another provider. You may also find other providers are cheaper.

dunstonh

You are paying management charges of a sort if you have your money in a bank account. The only difference is that the charges on pension funds are explicit and the charges on bank accounts are implicit. A typical stakeholder actually has lower charges than bank accounts. The "net interest charge" (not to be confused with tax) is typically around 1-1.5%.

FP offer lots of funds covering many different investment areas, including cash, property, fixed interest and equities. 25 years to retirement is a long time and the market drop we have seen has been sharper than others but as of date it is less than the drop we saw 6-8 years ago. What did you do with your investing during that drop? Why do you want to do different now?

FeeBeeKay

Thanks for your replies - they have been very helpful.

I am 35, and was not investing in anything at all the last time the market tanked. I actually only took out the pension in my last job because of the generous employer contribution. I was made redundant a year ago, and have since had a child and am on a career break - probably for the next 5 years, so if leaving the money where it is already is the safest option long term then looks like that'll have to be it til I can look at starting contributions again in a new job.

Thanks again

FeeBeeKay