Pension: Cash Equivalent Transfer or Refund

Jaspr

Hello, I'm hoping I can get pointed in the right direction obviously I understand any info given in on has to be opinion rather than advice and will be treated as such. TIA

I was with a company for 6 months'ish and paid into a pension scheme. I left just before Christmas, I have received a letter from the pension company.

I have been offered a refund of what I paid in (minus tax and NI) or a cash equivalent transfers of around 4 times that amount, I guess that includes the employers contributions ! I
am currently working as a contractor so don't have a pension running currently and the pension company have put a a time limit of 3 months on my decision.

My question is this

Should I take the money and run OR is there a type of product I can transfer my Cash equivalent transfer fund into ?

silvasava

Hi Jaspr - I would think the transfer would be the best option or you will lose out on the contributions paid by your previous employer & believe me every little helps! I would suggest you look at putting it into a Stakeholder Pension. From my (very) limited knowledge if your work is likely to be for short term contracts you can put in what you like when you like up to a certain limit. There are also very low charges. I'm sure there will be other MSE'rs who can also give you good pointers

lisyloo

If you take the cash, you'll lose the employer contributions (from the sounds of it) plus the tax and NI.
This sounds like a no-brainer to me.

Loughton_Monkey

Isn't it a bit of a no-brainer to set up your own pension and transfer the 4X amount in? Hope you are thinking about the big question "What am I going to live on when I retire?"

Jaspr

Cheers guys, I'll take a look at a Stakeholder Pension, if I can put money in when I'm earning it is a no brainer

:T

silvasava

Jaspr wrote: »

Cheers guys, I'll take a look at a Stakeholder Pension, if I can put money in when I'm earning it is a no brainer

:T

Jaspr - I'm sure if you search the forums you'll get some more ideas but it would seem silly to lose the employer contribution as its 'free' money!

Jaspr

Thanks I will. Had a little prod around and I think I need professional help to decise where to put it, but (I agree I don't want to lose that freee money

:money: :beer: