Serps / State Second Pension

joey0027

Hi

I'm hoping that somebody may be able to give me some advise on the state second pension.

19 years ago I opted out of SERPS and arranged for the rebates to be paid into a Abbey National pension account to which I have paid no additional payments over the years.

I have recently received a letter from Abbey advising that unless advised otherwise I will automatically be opted back into the State Second Pension scheme and will therefoe receive no futher direct payments.

I am 35 years old and am unsure as to what would be the best course of action to take. I must admit my instinct is to remain opted out of the scheme and continue to have my rebates paid into the pension plan.

Any advice or comments would be greatly appreciated.

I also have a pension plan with Allied Dunbar which was set up around 17 years ago through a previous employer. I have paid nothing into this account for around 16 years and the value seems to decrease each time I receive a statement. I presume that this plan is liable for admin charges although not shown on the statement hence the reason for the decline in value along with changing market conditions. It only has a transfer value of around £100 so I thought that I would attempt to transfer it to my Abbey plan previously mentioned. I have today received a letter from Abbey advising that I am unable to transfer.

I am therefore unsure what to do, do I have any other options available or do I have no choice but just to leave it in place & watch the value decline?

Many thanks in advance to you all.

Kind regards

Joey

CIS

You need an IFA to check the figures for you as everyones situation is different.

dunstonh

CIS is spot on. There is no 100% answer on this one. Your age, size of rebate, investment risk profile, pension plan (focusing on charges and funds), your retirement goals, personal circumstances and views on political risk all impact on whether it is best to contract in or out.

If you dont know those things affect contracting out then you really need to speak to an IFA.

So far this year I have contracted more people out than I have over the last 3 years. However, I have also contracted more people back in again as well. This is in part to an increase in the information available to help make that decision, which has been missing in recent years.