opt in or out please help

neil_e_broke

i am 44 yrs old and have been making pension contribution payments for 20yrs
but have recently frozen all payments due to their under prerforming, should i still be opted out of serps or not? please help!

EdInvestor

Probably not. In 5 years time it will stop anyway.

Have you looked at your state pension forecast, which will of course rise if you opt back into SERPs (S2P) again? Forecast here:

https://www.thepensionservice.gov.uk

Perhaps you should also consider moving your old underperforming pension to some new funds, or even to a new provider, if the costs are very high?

dunstonh

but have recently frozen all payments due to their under prerforming

Pensions invest in all the areas that other tax wrappers have available (such as ISAs). If you arent happy with the investments you have then change them.

should i still be opted out of serps or not?

You are now past the age where it gets harder for contracted out benefits to match contracted in. However, if you dont trust the Govt to pay the second state pension (reduced 3 times already and a forth is on the cards) or you want the pension earlier than the state pension age and/or you want 25% lump sum then you may decide contracting out is best. A lot of it will depend on your income level as well.

jamesd

If it was right for you initially, your risk profile is fairly high and you earn over say 25,000 a year it's fairly likely that staying contracted out is a reasonable choice.

A massive reason not to do it is that you appear to have been invested poorly for 20 years but haven't fixed it yet. That suggests that you may not be monitoring your investments enough to achieve the gains you need to be better off.

Best to first say more about your current pension arrangements and how much risk you're willing to take - how much of a sudden drop in one month with years to recover you'll accept in order to improve average gains.