Best way to increase my pension

tessieb

I'm working as a part-time teacher and am paying into the teachers pension scheme. I recently got a pension statement and the annual amount I will receive at 60 (if there were no more contributions) is just over £5,000 a year. I am 45 so will be contributing more though as I work part-time it won't increase as much as if I were full-time. I do have a very small amount in a BT pension (from over 20 years ago) and have about £7000 in a Prudential AVC, which I stopped paying into about 7 years ago.

Ideally I would like to retire at 60 and I'm aware I need to increase my pension. What is the best way? I could start up the AVC payments again, or would a SIPP be better? If I do start a SIPP should I transfer my BT pension and AVCs across too?

FatherAbraham

tessieb wrote: »

I do have a very small amount in a BT pension (from over 20 years ago) ...

If I do start a SIPP should I transfer my BT pension and AVCs across too?

You should almost certainly not transfer the BTPS pension. It provides an index-linked pension with 50% survivor benefits. The investment risk lies with the fund, and BT Group (and possibly the state too, if the Crown Guarantee test case was resolved that way, I can't remember).

I expect someone will be along in a moment to point out that no money-purchase scheme will touch an occupational-pension transfer in without evidence of advice to that end from your IFA. Unless you have very special circumstances, you will not find any IFA who would recommend you take such a self-damaging action, for fear of the liability.

Warmest regards,
FA

tessieb

Thanks FA. I did wonder if the BT pension would be better left alone and it sounds like it would be.

GhIFA

FatherAbraham wrote: »

Unless you have very special circumstances, you will not find any IFA who would recommend you take such a self-damaging action, for fear of the liability.

Whilst the sentiment is correct, the pedant in me would say that the reason why you won't find an IFA to touch a DB transfer is not due to "fear of the liability" but due to the fact that in most circumstances it won't be the best advice.

gadgetmind

GhIFA wrote: »

the reason why you won't find an IFA to touch a DB transfer is not due to "fear of the liability" but due to the fact that in most circumstances it won't be the best advice.

How touchingly naive.

Without fear of retribution, members of the financial industry will do (and demonstrably have done in the past) whatever suits their best interests with little/zero consideration of what's best for the client/sucker.

They are no more/less evil than used car salesmen, emergency plumbers, and crocodiles, thus should be treated in much the same way when it comes to degree of trust.

Always do your own research, get 2-3 opinions, and don't let the thrall of a pinstripe suit and gold watch turn your head.

bigfreddiel

work longer - bigger pension - plus bigger monthly inome while working

for me working 2yrs longer = 10% increase in pension and £25k more earnings - win-win situation

its too easy

fj

tessieb

So, which is the best way to add to my pension fund - start a Sipp or restart the AVCs? I feel I've got some catching up to do.

xylophone

http://www.nasuwt.org.uk/PayPensionsandConditions/England/Pensions/AddingtoyourTeachersPension/index.htmhttp://www.nasuwt.org.uk/PayPensionsandConditions/England/Pensions/AddingtoyourTeachersPension/index.htm

BobQ

tessieb wrote: »

So, which is the best way to add to my pension fund - start a Sipp or restart the AVCs? I feel I've got some catching up to do.

You should be able to purchase some additional pension under the TPS.

http://www.nasuwt.org.uk/PayPensionsandConditions/England/Pensions/AddingtoyourTeachersPension/index.htm

This will add a pension income to your existing pension index linked as for your main pension.

The other options are as you state. As to which is best you need an IFA (which you could get through your union I suspect).

GhIFA

gadgetmind wrote: »

How touchingly naive.

Without fear of retribution, members of the financial industry will do (and demonstrably have done in the past) whatever suits their best interests with little/zero consideration of what's best for the client/sucker.

They are no more/less evil than used car salesmen, emergency plumbers, and crocodiles, thus should be treated in much the same way when it comes to degree of trust.

Always do your own research, get 2-3 opinions, and don't let the thrall of a pinstripe suit and gold watch turn your head.

How sweet - the law of the sweeping generalisation again that regularly gets trotted out when there's nothing constructive to say.

atush

Can the teachers pension AVCs be used to fund the tax free lump sum? If so, I'd go the AVC route. If not, then you need further advice.

Other ways to help your retirement would be saving into ISAs as these can help when you retire early before all your pensions start as well as paying off your mtg.