Opt back into serps.

Phil_Doyle

I have been paying into a pension for nearly 25 years, and have just received notice from my pension company ( Prudential ) that it may be prudent to opt back into serps.
When i rang them and after 1/2 hour of finacial spiel i was still non the wiser, as the general gist seemed to be in the end it was " my choice ".
Now i'm a maintenance engineer and don't consider myself thick, but i am really clueless as to which is the best option, and whilst i reaslise there maybe no definitive answer i am sure there is someone out there with more idea than me.
Please help.

dobefan

Hi Phil,

Sorry I'm as clueless as yourself, perhaps worse! Some of these pension houses are cutting the pension forcasts by as much as 25%. To me thats like stealing my money, I've decided that there are very few places left to put your savings or investments on long term grounds. If you are a trader then there are still oportunities, but for the average 'Joe' you need to do your own research and spread your risk ... perhaps a bit of gold and a bit of property would be a good start, but trusting guys on big bonus's to look after my money, that day is over for me. I will be leaving my investments / pension as is, but certainly won't be adding to them.

Cheers

jem16

Phil_Doyle wrote: »

Now i'm a maintenance engineer and don't consider myself thick, but i am really clueless as to which is the best option, and whilst i reaslise there maybe no definitive answer i am sure there is someone out there with more idea than me.
Please help.

Optimum age for opting back in is 43 for males and 40 for females.

dunstonh

Some of these pension houses are cutting the pension forcasts by as much as 25%.

No they are not. The FSA has instructed firms to use lower rates than standard if the investment funds used have lower growth potential than the standard. So, if you invest in a cash fund or low equity with profits fund, then its only right to get lower projections as you highly unlikely to see 7% or 9% returns.

There has also been an increase in SMPI basis illustrations replacing or used in conjunction with monetary growth illustrations. SMPI deducts 2.5% p.a. for inflation to attempt to give an indication of real terms value.

To me thats like stealing my money

How can you steal something that doesnt exist?

I've decided that there are very few places left to put your savings or investments on long term grounds.

What is your reasoning for that?

perhaps a bit of gold and a bit of property would be a good start

a bit of gold at the top of a bubble that is likely to burst when confidence returns and property which is coming off a bubble fueled by easy credit. Pretty high risk strategy.

but trusting guys on big bonus's to look after my money, that day is over for me. I will be leaving my investments / pension as is, but certainly won't be adding to them.

Crazy. You are complaining about illustrations using realistic rates which would only apply if you have low risk/low potential assets and then suggest alternatives that are significantly higher risk. If you want to go high risk then fine. However, why not move your pension into high risk assets as well instead of complaining about it being low risk.

dobefan

Ohhhhh ... I'm trembling in my boots ... thats all very defensive coming from yourself as an IFA. Everyone is intitled to an opinion. Just because it affects your bread and butter you will have to be upbeat about it.

All IFA's want to do for me is shift my money around and get commission, they had chosen the homes for my cash in the first instance.

Cheers

dobefan

quote:
a bit of gold at the top of a bubble that is likely to burst when confidence returns and property which is coming off a bubble fueled by easy credit. Pretty high risk strategy.
~

You're one smart cookie that can call the top of a bubble, and an even smarter one that can say property is a bad buy at the moment.


Cheers

dunstonh

Just because it affects your bread and butter you will have to be upbeat about it.

Yes of course it affects my income. I am going to lose so much by you doing what you are doing. Idiot.

Phil_Doyle

jem16 wrote: »

Optimum age for opting back in is 43 for males and 40 for females.

I'm 47, so where does that leave me ?

Phil_Doyle

There has also been an increase in SMPI basis illustrations replacing or used in conjunction with monetary growth illustrations. SMPI deducts 2.5% p.a. for inflation to attempt to give an indication of real terms value.


See more financial jargon being banded about.dunstonh, you seem to be the man for my sort of problem, what's your take on my situation ?

jem16

Phil_Doyle wrote: »

I'm 47, so where does that leave me ?

Likely to be best opting back in.

Phil_Doyle

jem16 wrote: »

Likely to be best opting back in.

But why ? for what reason ?