Pension advice

theshortstack

Hi there,

I've been trying to get up to speed on my current pension arrangements as I've been blindly paying not them randomly over the last few years and I'm now trying to evaluate the next best steps forward.

Essentially, I've had three different company pensions all with the same provider over the last five years. In order to maximise their value and get my savings back on track, I seem to have a couple of choices:
- Merge all three policies into one to presumably strengthen compound gains
- Move all three policies into a SIPP and manage it myself from there

While I like the idea of the SIPP (and associated tax breaks), I'm still fairly new to investing, so I'm not sure Id want to take full responsibility for my pension yet, so I'm leaning towards the first option.

Is there any reason, why I wouldn't want to merge the three policies into one? Is that the best idea or is there another option that I haven't thought about?

Thanks very much for your help!

bigadaj

Merging your pensions is dependent on three things. Firstly will they allow it, and then a combination of charges and range and flexibility of investment options.

Find theses things out and then post back. People generically refer to SIPPS but personal pensions can be as good for most people and can be cheaper.

dunstonh

Essentially, I've had three different company pensions all with the same provider over the last five years. In order to maximise their value and get my savings back on track, I seem to have a couple of choices:
- Merge all three policies into one to presumably strengthen compound gains
- Move all three policies into a SIPP and manage it myself from there

Why SIPP?
Why do you think consolidating them will be better (it could but it may not)?

While I like the idea of the SIPP (and associated tax breaks), I'm still fairly new to investing, so I'm not sure Id want to take full responsibility for my pension yet, so I'm leaning towards the first option.

again this leads to Why SIPP? Personal pension and stakeholder pension have the same tax treatment. The difference is charges and investment options. SIPPs are typically the most expensive option (caveats apply) and aimed at the more sophisticated investor who wants assets that cannot be easily obtained in the other two and dont mind paying for them.

atush

I seem to have a couple of choices:
- Merge all three policies into one to presumably strengthen compound gains
- Move all three policies into a SIPP and manage it myself from there

First of all, merging may not strengthen compound returns. If the investment are the same the compounding remains the same. what changes on merging is charges and fund choice. These can affect your returns.

Sipp or PP? Will you use all the bells and whistles of a SIPP? Or will you be paying extra fro nothing? The extras are assets like single shares and commercial property.

theshortstack

dunstonh wrote: »

Why SIPP?
Why do you think consolidating them will be better (it could but it may not)?



again this leads to Why SIPP? Personal pension and stakeholder pension have the same tax treatment. The difference is charges and investment options. SIPPs are typically the most expensive option (caveats apply) and aimed at the more sophisticated investor who wants assets that cannot be easily obtained in the other two and dont mind paying for them.

Thanks for your thoughts dunstonh - it sounds like I may be trying to bite off more than I can chew. I'll have a look into Personal and Stakeholder pensions.

As for the consolidation of my existing policies, I was thinking that having one large pot to invest would make things easier to manage and allow more flexibility when it comes to making larger investments.