SIPP? Question

ACG

Is it really that valuable?
I dont think there would be a lot in it, maybe £10-15k at best. I was there for about 4 years from being 19-23... im now 29.

I would never make a complaint, it would be helping me get what i want. But i dont think that will be achievable anyway going off the previous post.

Part of the reason i would not mind cashing it in is i would have a commercial property worth say £100k with a £70k mortgage, im not paying rent on an office but instead building up equity, i also have another 30-40 years to build up a pension.

jamesd

Tell us what the statement says. To give some idea, HMRC values a final salary pension at twenty times the annual payout for lifetime allowance purposes and for those at retirement age the Pension Protection Fund valued the miner's pension at 29 times the income for those of retirement age, saying that was the actuarially neutral value for taking a lump sum in exchange for reduced income.

Because of the value and guarantees it's generally best for those who don't have a radically reduced life expectancy to just leave defined benefit pensions alone and add to their planning with other money instead of touching them.

dunstonh

I would never make a complaint, it would be helping me get what i want.

You wouldnt need to make a complaint for it to be found out. It is reported to the regulator. If that firm gets a visit, they could select it. If the IFAs are network members, it will almost certainly have 100% checking applied to pension transfers.

A small number take on the high risk business of allowing insistent client on a pension transfer. Its not common though.

Is it really that valuable?

Stats have final salary schemes better than a transferred personal pension in about 99% of cases. You could be in that 1% but with those odds, it is unlikely.

ACG

Frustrating. I just feel like i could get far more from it now earlier in my life and make up for it in the long term - either way, it doesnt matter as there is not enough in it to do what i wanted even if i could get it through.

thenudeone

ACG wrote: »

Oh noooo thats even worse!

I might be able buy half a building with that

Putting to one side the likelihood that no IFA would ever sign off a transfer into a SIPP, if you did manage to transfer into a SIPP, you could then transfer any other pensions you have, and make additional contributions (up to 100% of income or £50k, whichever is lower) to provide the SIPP with the funding it needed for the purchase.

But since many people are already highly invested in property (and sometimes highly geared as well, if they have a mortgage), diversifying into different asset classes would probably be a better move than putting even more eggs into the same basket, IMO.

I am old enough to remember two periods of significant property price falls in my adult life and the subsequent impact of negative equity on the economy. Property prices do go down as well as up.

ACG

It would not bother me whether the price of the property was £10k or £250k - i would be using the property for business purposes. It would save me spending money on rent. The only time i would be interested in the value of the property is when i come to sell it, but that would be 10-20 years down the line.

I look at that in the same as the value of my house, i dont care what its worth as its my home. Im happy here and i have no intention of moving.

Appreciate the thoughts and looking at it from all angles and i believe i have. IF i could get the funding needed (which it seems i cant) then i would not hesitate in doing this as i would rather be paying a mortgage and building up equity than i would rent, but it seems thats my only option.