Pension need to knows Official MSE Guide Discussion

kirstymux

If I want to put away another £50 per month for retirement, am I better putting it in my NEST pension or just in a savings account?

dunstonh

kirstymux wrote: »

If I want to put away another £50 per month for retirement, am I better putting it in my NEST pension or just in a savings account?

Those two options are not comparable. NEST is closest to the objective but NEST is not great. But with a very small amount of £50pm, the choice is not going to be great as most providers want £100pm or more.

IanWorthington

dunstonh wrote: »

If you have a secure income (occ scheme/lifetime annuity) then there is no impact on future contributions.

If you have an unsecure income (drawdown taken from the 75% segment of your pension) then your annual allowance for contributions would be reduced to £4000 a year.

I have an occupational pension and a SIPP. Do I understand then correctly that I can take from the occupational without problems but as soon as I touch the SIPP my ability to make future contributions is permanently curtailed?

That's a bit of a !!!!!!. Any possible solutions for those of us who need to dip in to survive but then can pick up work in the future?

MallyGirl

If you don't take more than the 25% tax free lump sum then you don't invoke the tax relief contribution limit set by the MPAA (money purchase annual allowance) which is currently £4k per year.

IanWorthington

MallyGirl wrote: »

If you don't take more than the 25% tax free lump sum then you don't invoke the tax relief contribution limit set by the MPAA (money purchase annual allowance) which is currently £4k per year.

Ah, that might be a solution. How is the 25% calculated? Just at the point of first withdrawal? Or is it upped by further contributions?

AlanP_2

Each 25% TFLS withdrawal is an "event" whereby you get the 25% and 75% gets marked as crystallised (so no more 25% from that even if grows by a massive amount).

The remainder of the fund, and new contributions, continues to grow until the next event.

Personally I wouldn't take 25% of everything in one go unless I really needed to, may be so much per year as earned income fluctuates.

Tooty

Hello,

I'm a freelancer, so self employed and on average earn £20,000 before tax. Due to my age, 44 years old, I am needing to pay in £375 per month. I've read all of the information on the Pensions page, but there is little information regarding what to do if you are self employed. I still struggle to understand the different types of pension and would like to know what product would be best for my situation.
I also have 2 pensions from previous employers which have very little in them. What should I do about those?

Thanks,
T

dunstonh

I've read all of the information on the Pensions page, but there is little information regarding what to do if you are self employed.

There is very little difference except that you dont have an employer scheme to join.

I still struggle to understand the different types of pension and would like to know what product would be best for my situation.

That would be impossible to say without an analysis of your situation, objectives, knowledge and understanding and your ability to understand.

I also have 2 pensions from previous employers which have very little in them. What should I do about those?

That would require analysis of those pensions and compare them to modern alternatives.

If you don't think you are up to doing the pension on a DIY basis, then use a local IFA.

LyndsayCHolmes

Hi, I am wondering if I can get a private pension if I already have a work one and who is the best pension manager to approach this? Please and thanks

dunstonh

I am wondering if I can get a private pension if I already have a work one

Yes you can.

and who is the best pension manager to approach this?

There is no one-best-solution. There are lots of providers and depending on your amounts, how you want to invest, what features you are looking for, how you intend to buy it (DIY, IFA, FA etc all have different pensions) etc will influence who is percieved to be best.