What to do with Company Pension when being made Redundant

Tobywoby

I am currently working my notice having been made redundant, I have a final salary company pension scheme which I have paid into for 16 years.
What would be my options, I know it's a mine field and difficult to advise exactly but assuming my new employers have a pension scheme it still may not be a good idea to transfer anything into it.

I am 38 and married with a child and want a relatively safe option but don't mind a small risk but I don't want to have to revisit it once it is set up.
Would it be better to have a SIPP, Isa's, Pension ?? anymore I should look into ?

dunstonh

What would be my options, I know it's a mine field and difficult to advise exactly but assuming my new employers have a pension scheme it still may not be a good idea to transfer anything into it.

Its not that difficult. If the new scheme is better, you move to that. If the old one is better, you stick with that.

The difficult bit is having the knowledge and experience and often analysis tools to see which one is better than the other.

Would it be better to have a SIPP, Isa's, Pension ?? anymore I should look into ?

You are jumping the gun there. Generally, a final salary scheme is better than a money purchase. (a few exceptions but 9 times out of 10 would be fair).

Tobywoby

Thanks for the reply. So lets say I leave my final salary pension where it is and freeze it, I am now with the new company and their pension is average, what else can I look into as an alternative to their average pension ??

dunstonh

what else can I look into as an alternative to their average pension ??

SIPP, PPP,SHP or ISA generally.

If there is any free money involved in the new pension scheme, you should take it. Even if the scheme itself is poor. Example: even if the employer contribution is 1%, you should put in enough to get that 1% and then look for your own arrangement as an increment and not a replacement.

novice-saver

Another thing to consider about leaving your existing pension with the company you're leaving is how their business fares in the long term - I.E. at least up to the point you start to draw the pension, and preferably to the point you stop..

If they fold, your final salary scheme with them won't be worth much to you, before you start claiming.

It's impossible to second guess the future, but if your redundancy is the business contracting to try and save costs, is it just a blip, or are they having difficulties?

EdInvestor

Try asking for some free advice about your final salary pension here:

https://www.opas.org.uk

Pal

novice-saver wrote:

Another thing to consider about leaving your existing pension with the company you're leaving is how their business fares in the long term - I.E. at least up to the point you start to draw the pension, and preferably to the point you stop..

If they fold, your final salary scheme with them won't be worth much to you, before you start claiming.

It's impossible to second guess the future, but if your redundancy is the business contracting to try and save costs, is it just a blip, or are they having difficulties?

Sorry NS but you are wrong. Final salary schemes are subject to strict funding requirements, a full funding requirement on wind up, and have a 90% guarantee on most benefits up to £25k a year from the Pension Protection Fund.

The long term future of the company is irrelevant. Final salary schemes are always worth joining these days, and are the safest possible place to leave your benefits.