Confused and Unsure - pensions etc

workingboy

Due to retire shortly, confused and unsure about the 3 different pensions I have from previous and current employer and what to do next.

From my previous employer, I had a Final salary pension held for 9 years till frozen when made redundant in 2001. Also had another pension by contracting out of SERPs and continued contributing from 1990 till 2007 again frozen and returning to the state pension scheme.

From current employer, having a Stakeholder pension and contributing since 2001 from wages.

I understand that the pension companies for the Stakerholder and Serps pension will approach approx 6 weeks before retirement with figures as whether I want an Annuities with them or approach a Financial adviser for a better provider of my pension. And for the Final Salary pension I have to accept the annuity offered.

Or can I put all 3 into the pot for the best Annuity or what am I to expect.

I will approach a Financial Adviser but not wanting to pay too many fee's etc. for advice of what happens next etc. Any advice of what happens next??

totally confused, thanks :wall:

atush

First of all, you are waitning a bit late if you are worried and want to plan. Best to do this sort of worry/planning 5 years before incase you need to make changes.

Second, you leave your FS pension alone. No mixing it with others, it is too valuable.

What to do with the rest will depend on lots of things. Form your other savings/investments/debts you hold to the terms of the other policies (an if there are any beneficial guarantees). and Annuity rates re at an all time low, so buying one is no longer required and may not be the wisest course of action.

So, get up to date forcasts frm all your pensions incl your state pension. And get your partner if you have one to do so as well. And say if you will get your SP now or are you relying on the other pensions to see you thru before taking the State pension.

jamesd

Do not take the pension annuity directly from any of the companies. Always use an IFA from unbiased.co.uk. Yes, you can combine them and that might get you a better annuity rate. An IFA would normally be happy to do this on commission basis if you didn't want to spend cash up front. Which is cheaper depends on the value of the pension and the IFA should tell you and offer you the choice of way to pay.

If you even want to buy an annuity. You can just keep the money invested and start taking an income from it instead if you like.

IFAs are like builders. Don't just take the first one you get a quote from, try two or three and pick the one that you like best.

dunstonh

I will approach a Financial Adviser

You dont want an FA. It needs to be an IFA. FAs will be limited panel at best. IFAs will be whole of market.

not wanting to pay too many fee's etc.

The annuities from the existing providers will include a commission whether you use an adviser or not. If you dont use an adviser they will keep the commission for themselves. If you do use one, they will pay it to the adviser. So, in most cases, it is cost neutral to use an IFA. You have nothing to lose and everything to gain.

Normal process is to get an IFA in about 2-6 months at least before its due (time-scale depends on your knowledge and understanding of what you have and what you can get). The IFA will ask a range of questions (including health situation for you and spouse/partner) and write off to the companies to obtain details and forms. Once they have arrived (which can take 1-4 weeks) they can then research the options available, haggle them in many cases and then present you with the outcome. Transfer of pensions can take 1-4 weeks as well.

Nearly_Old

workingboy wrote: »

Due to retire shortly, confused and unsure about the 3 different pensions I have from previous and current employer and what to do next.

I will approach a Financial Adviser but not wanting to pay too many fee's etc. for advice of what happens next etc. Any advice of what happens next??

totally confused, thanks :wall:

I was in a similar position last year as I was offered a redundancy deal that turned into early retirement. I had a frozen Final Salary pension from my first employer and 2 separate funds from my other two employers. I had worked out a basic retirement budget and rounded up details of our other savings and investments.

The next stage was to see an IFA and we were fortunate that our son is part qualified so we used his company - very small firm but its been established for sometime with just 3 of them at the moment. They checked our draft retirement budget and prepared an analysis of our potential pension income and this was all discussed with them. We then refined our budget and we had another meeting to discuss the merits of drawdown vs annuity. I'd always assumed that I would go down the drawdown route but they produced a very detailed analysis of the potential of both options. In the end I went with the annuity as my wife has a final salary pension when she retires this September, her state pension starts in January 2013 and mine starts in April 2014. These pensions and my final salary pension are all index linked and exceed our retirement budget by enough to mean that I could take a level annuity. We have other savings and investments that could provide additional income if required in the future.

Having decided on the annuity route we then went with the Open Market Option and all I had to do was complete the forms and they did all the work. They have also recommended alternative platforms for our S&S ISA's to make it easier and cheaper to switch between growth and income funds in the future. We have paid a fee of 1% of the net fund value; i.e. the value after the 25% tax free lump sum has been taken.

No matter how much information is around I would recommend seeing a good IFA and you can ask more than one to say a) what service they will provide; and b) what their fee will be.

Good luck and enjoy your retirement.