Pension Review & Advice

bendix

Daft_Pegasus wrote: »

You can see your debt decrease with a mortgage whilst the pension funds are less tangible and despite being paid into have decreased in recent times.

Two points:

1) While paying off your mortgage is laudable and it's good to see the debt decreasing (I know, cos I've been through it). It's a great feeling. My point though is that now that it is down to a relatively small figure, it will effectively decrease of its own accord now as the value of money decreases and your salary rises. In a few years, it will seem like a credit card bill, not a mortgage. Keep paying it down, for sure, but take a more balanced approach. I see you knocked off nearly 7k in a year. Great - but this year, increase your pension contributions by 400 a month (and remember the tax break!), and you'll still be paying down the mortgage at the same time.

2) re your point about pensions decreasing at the moment. Isn't that a great argument to increase the contributions right now?

dunstonh

whilst the pension funds are less tangible and despite being paid into have decreased in recent times.

Although they have gone up more in the last 3 months than the mortgage interest rate you are paying. Investments zig zag. Always have, always will. You shouldnt look at short term periods in isolation. Indeed, when investments go down and you are nowhere near retirement, then its good news if you are making contributions. Its only bad news if you are not making contributions or you didnt reduce your risk before you retired and you have seen your pot fall with no time to recover.

EdInvestor

Ask Zurich for s transfer value on the private pension and see if there is a gap between it and the current value.

Some of those old AD pensions are subject to substantial exit penalties.

dunstonh

EdInvestor wrote: »

Ask Zurich for s transfer value on the private pension and see if there is a gap between it and the current value.

Some of those old AD pensions are subject to substantial exit penalties.

They are and many have no annual managment charges either as they were heavy on the contribution charges. So, making these paid up is often the best option. These ones are near impossible to justify switching to another provider.