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Tip for those with Hargreaves Lansdown ISAa and SIPPs
Comments
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grey_gym_sock wrote: »i thought HL didn't pay any loyalty bonus on SIPPs, only on ISAs. (though i don't have a SIPP with them.)
I'm sure you're right- I should really have said "the model where the platform pays the loyalty bonus/rebate in an unwrapped form".
All very interesting this is, though. If someone's receiving, say, 0.5% rebate off a £50k portfolio, receiving that rebate in the "right" way could be worth in excess of £150 (SIPP wrapped) a year.0 -
gadgetmind wrote: »Hmmm, I think I've only had BestInvest rebates into my SIPP so far. I'm assuming these don't count as pension contributions as I'm on a knife edge with those!
I can only hope that the £50k allowance lasts long enough for me to be able to benefit from that as well... but I fear it'll have been reduced by then.0 -
Perelandra wrote: »but I fear it'll have been reduced by then.
Yup, personal pensions have been under attack over recent years, and the ever more complex and restrictive caps are just part of this.
HMG are even threatening to restrict how much can be taken tax free at age 55 (remember when this used to be 50?) which does nothing positive for the reputation of either personal pensions or politicians.I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.
Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.0 -
gadgetmind wrote: »HMG are even threatening to restrict how much can be taken tax free at age 55 (remember when this used to be 50?) which does nothing positive for the reputation of either personal pensions or politicians.
Removing the last tax advantage that pensions have over ISAs...0 -
Perelandra wrote: »Removing the last tax advantage that pensions have over ISAs...
There would still be serious advantages for higher rate tax payers, and even those on basic rate throughout their entire working lives (bad career choices, dudes!) would get at least some pension out tax free.I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.
Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.0 -
there would still be serious advantages for higher rate tax payers who will be basic rate payers when they're drawing their pensions - unless tax rates change significantly over the next few decades. and it's very difficult to predict tax rates that far ahead.
there are generally far too many "if"s and "but"s and "you can't do what you want with your own money"s over the pensions. if they change the rules on ISAs so they are no longer favourable, at least you can take all your investments out of them.
it's a bit odd to worry about whether you'll still be allowed to contribute 50k a year to pensions when you can afford to. if you can afford to, you'll be doing fine anyway. and it may or may not be advantageous to make pension contributions anyway.0 -
gadgetmind wrote: »There would still be serious advantages for higher rate tax payers, and even those on basic rate throughout their entire working lives (bad career choices, dudes!) would get at least some pension out tax free.
Yeah, ok, I was being a bit glass-helf-empty earlier. Taking everything into account, though, without the cash lump sum I'd be tempted to put everything I could into an ISA, invest the rest to maximise my annual CGT allowance, and then buy a lifetime annuity on retirement with these unwrapped investments.
(No I haven't done the maths on this one!)0 -
Perelandra wrote: »I'd be tempted to put everything I could into an ISA
ISAs have even more restrictive caps than pensions.invest the rest to maximise my annual CGT allowance
Investing for dividend income and then using your CGT allowance makes sense. I'm doing this alongside ISAs and pensions.then buy a lifetime annuity on retirement with these unwrapped investments.
Purchased Life Annuities are not on my radar for a number of reasons.I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.
Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.0 -
Apart from the obvious loss of capital, what other reasons please?gadgetmind wrote: »Purchased Life Annuities are not on my radar for a number of reasons.0 -
Apart from the obvious loss of capital, what other reasons please?
The market for them isn't very competitive, so the tax advantages are fighting against worse rates. They also don't count towards MIR for flexible drawdown, and no, I can't see any good reason for this.
Lastly, my wife won't have much pension income, so we can use unwrapped cash to generate dividend income and pay no more tax.
Of course, plans and rules might change, and PLAs might come back on the table, but they are off it for now.I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.
Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.0
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