National Grid/British Gas Final Salary

mark55man

jamesd wrote: »

If he will have a total of at least £20,000 a year in final salary, state pension and annuity income he has one potentially interesting option: Flexible Drawdown. With this he can put money into a personal pension, get the tax relief, then later take out all of the money. The first 25% of the pension pot is the normal tax free lump sum. Any other money is taxed as normal income, so potentially higher rate tax if it's a lot. This can sometimes make it a wonderful idea for a person with a nice final salary pension to make pension contributions to a personal pension, because it removes the usual can't get at all of the money disadvantage of a pension pot.

Its quotes like this that make it worth reading this forum - I must have known and must have read that this was possible. I have been thinking about income drawdown etc, but like most people with multiple strands it is sometimes easy to lump them together mentally and forget about the benefits of treating them separately. Thanks James

chainsaw

kidmugsy wrote: »

Aye, or a worse pension.

I did say can and warn about the difficulty of generating a pension long term

chainsaw

atush wrote: »

rubbish. Show your figures,

Which bit is rubbish?

At 60 my transfer out value is £650,000 and my pension is £22,000. It depends what you can do with £650,000 if you think its rubbish or not.

xylophone

Discussion here https://forums.moneysavingexpert.com/discussion/comment/60690035#Comment_60690035

chainsaw

chainsaw wrote: »

Which bit is rubbish?

At 60 my transfer out value is £650,000 and my pension is £22,000. It depends what you can do with £650,000 if you think its rubbish or not.

Two or three weeks has past since I showed the figures and no reply, I didn't think I was talking rubbish and I am not

hyubh

chainsaw wrote: »

Two or three weeks has past since I showed the figures and no reply, I didn't think I was talking rubbish and I am not

It's not either/or though is it - you can take 25% as a tax free lump sum, and at a commutation rate better than in public sector DB schemes. Looking at the website, I also see you get uncapped RPI indexing (https://www.nationalgridpensions.com/409/729). What's not to like?

MoneySaverLog

The NG DB Pension scheme also has a dependents pension which if you have no one dependent on you could be better off taking the transfer value, depending on how long you expect to live into retirement.

hyubh

MoneySaverLog wrote: »

The NG DB Pension scheme also has a dependents pension which if you have no one dependent on you could be better off taking the transfer value, depending on how long you expect to live into retirement.

You can't take the transfer value of *just* the dependant's pension. If you think being single and without dependants on retirement (ignoring the scheme's apparently very liberal definition of 'dependant') nevertheless still points to transferring everything out, I'm not sure what to say. You understand you have a very, very good pension, right...?

mania112

If you are solvent and are divorced/widowed with children, there are many benefits to leaving a Final Salary.

For some people it's not about what THEY can get from a FS, it's about what their FAMILY can get when they die.

It's never possible to throw a blanket 'no' over it.

MoneySaverLog

Yes indeed understand it's a very good scheme. Just saying there may be better options in taking the transfer value depending on individual circumstances.