When to take my pension

jstype

Hi

My wife is 60 and I'm 61. We run our own business which we are thinking of closing next year. My wife has a personal pension with Virgin and I have one with Standard Life.

When we retire next year if we close the business should we both keep paying into our personal pensions until we are 65 or would the better bet be to stop paying in and start to draw the pensions? I understand the amount of money that your annuity earns you is becoming less and less.

Thanks

dunstonh

should we both keep paying into our personal pensions until we are 65 or would the better bet be to stop paying in and start to draw the pensions?

They are only two of the reasons but not the only ones available.

I understand the amount of money that your annuity earns you is becoming less and less.

A bit but that has already happened. Its more or less got to the levels now where there isnt much more it can drop. (interest rates being low and unlikely to fall lower). As you get older annuity rates rise. There is also no reason to buy an annuity as you can look at unsecured pension options.

Virgin pensions are rubbish. So, if you stay put, its not a good option. Standard Life have had many different pensions over the years. Some good, some poor. Some with guarantees that can be valuable.

What it best will depend on what your finances, tax position and requirements are. There is no rule of thumb (although if you dont need the pension then dont take it is a basic generalisation that is right more than it is wrong).

What other income will you have? What other investments and savings do you have? It may be still worth contributing to pensions even if you are not working.

jstype

Thanks for the advice. We will have very little income but no mortgage and hopefully more than enough savings to cover us. We do not have any children so we might do equity release at some time as we would rather spend the money ourselves than leave it to distant relatives.