What does the Chancellors pension revolution mean for us?

atush

ginny1011 wrote: »

Hi I have schizophrenia and was medically retired two years ago I am 44 I receive a annuity of £361 once a year can anyone please tell me if I can take a lump sum out My pension is worth about £10000

Quote:
Originally Posted by rpc View Post
No, capital is lost when it is spent. Once you have bought an annuity, you no longer have capital.

atush

Francesca7777 wrote: »

I love all this feigned 'empathy' masquerading as 'advice'!! What is really meant is there is concern that if people cash their pensions in early that they may end up being benefits drains! Fair enough... but let's call a spade a spade perhaps, and stop trying to disguise those sorts of intolerant assumptions as 'empathy'? So 'you', Atush, 'have empathy, but I don't'?! Really??? Have you been handed the Nobel Peace Prize yet I wonder??? Or are saints excluded from this award because they shouldn't be shown biassed favouritism?

Nothing is wrong with giving advice, when it is ASKED for. It's just rude to ask people questions about their personal circumstances, or even worse, make 'assumptions' about their personal circumstances. You think you're doing something really benevolent and caring here... Had I logged on and just observed many of the responses here I would have just thought to myself, "What a bunch of arrogant self-important bozo's!" The 'advice' here, as unsolicited as it may be, is free!!! I guess you get what you pay for.

All I want is the best for people. I am sorry you can't believe that. And I am very sorry you are so bitter about your situation.

And for most (if not you and how I could I have known) that is to not cash in all of their pension in year 1. But at least you now know you can? You were not aware of this I am sure from your first and subsequent questions. I do know you wont admit it now.

I have no axe to grind, and I was born with no silver spoon.

You came here a day ago to ask about this, but haven't seen the number of individuals who have wanted to cash their pensions in, day on day, for years. Most for no good reason.

Because they want to spend spend spend. Because they already did and are in debt. Because of some other reason.

In the NEW pension world, you will have to sit face to face with someone and tell them everything they ask (not be penurious with facts as you were here) and then they will give you advice. Based on all the facts, not just what you choose to divulge. And if you choose not to, you might just have to sign something, that would prevent you from claiming bad advice should you have been lacking in truthfulness.

I asked what I did, as I am VERY concerned about all who have not saved enough to fund the years they have left- short or small. I am not sure I have, but at least I am thinking about that.

I don't begrudge you your anger, but I think it might be misplaced.

atush

RobStaffs wrote: »

I am 50 and was wondering if it is advisable to put additional contributions into your pension scheme say for the next five years to take advantage of reduced NI in a payment sacrafice scheme and get the deferred tax benefit?

If would have been before the changes, it will be more so now.

atush

Gorgeous_George wrote: »

The change is quite interesting. Like the rest of the budget, it benefits the rich who will have the larger pension pots.


However, compulsory annuities were one of the reasons that I would never save in a pension fund. The other is that any tax benefits are more than wiped out by the fees.


At least with the capital one would be able to buy a house or houses to let out (possibly to family members). This could turn £100K into an income of £600 per month that would rise by inflation and the capital is as safe as houses. Annuities couldn't match that.


GG

i am pretty sure you can get 6K of an annuity of 100K now? Or 4-6% off a DD and keep your capital?

Mattygroves2

Credit-Crunched wrote: »

Also, its almost impossible to imagine an asset such as a house falling 35% in value over a 12 month:rotfl: period

But what you need in retirement is steady income rather than capital growth. So if I'm in drawdown and my investments still continue to pay dividends then I'm not worried about a sudden fall in capital growth. If they stop paying a dividend then I need to rethink and may have a problem which is why you diversify so not all your eggs are in one basket.

An annuity gives you certainty over your income (as do DB pension schemes) and if you choose the right one they increase with inflation. BTLs have their place as pension vehicles but as part of a diversified portfolio where a sudden boiler replacement or 6 month void can be covered by income from elsewhere and a tightening of belts.

Would I trade my DB index linked pension scheme (the equivalent of an annuity) for a BTL - absolutely no way. I might think about taking some money out of my ISA or use an inheritance to buy one though.

Triumph13

Credit-Crunched wrote: »

Also, its almost impossible to imagine an asset such as a house falling 35% in value over a 12 month:rotfl: period

Let me think. High speed rail link through your back garden, Japanese knotweed, flooding or subsidence making it unmortgageable, closure of main local employer, another sub prime saga, etc, etc, etc.

Francesca7777

atush wrote: »

All I want is the best for people. I am sorry you can't believe that. And I am very sorry you are so bitter about your situation.

And for most (if not you and how I could I have known) that is to not cash in all of their pension in year 1. But at least you now know you can? You were not aware of this I am sure from your first and subsequent questions. I do know you wont admit it now.

I have no axe to grind, and I was born with no silver spoon.

You came here a day ago to ask about this, but haven't seen the number of individuals who have wanted to cash their pensions in, day on day, for years. Most for no good reason.

Because they want to spend spend spend. Because they already did and are in debt. Because of some other reason.

In the NEW pension world, you will have to sit face to face with someone and tell them everything they ask (not be penurious with facts as you were here) and then they will give you advice. Based on all the facts, not just what you choose to divulge. And if you choose not to, you might just have to sign something, that would prevent you from claiming bad advice should you have been lacking in truthfulness.

I asked what I did, as I am VERY concerned about all who have not saved enough to fund the years they have left- short or small. I am not sure I have, but at least I am thinking about that.

I don't begrudge you your anger, but I think it might be misplaced.

But I wasn't looking for advice, or I would've asked for it! Hello??!

And I'm not bitter about my situation! I'm cool with it! Yet another ASSUMPTION from you!

If you re-read my posts I was fine and jolly and friendly until you wound me up with your intrusive questions and patronising attitude.

Just a word of advice (even though YOU never asked for it!!!), never work with the public - it's clearly not your strong suit... in MY humble opinion...

Let's leave it there I reckon...

atush

Mattygroves2 wrote: »

But what you need in retirement is steady income rather than capital growth. So if I'm in drawdown and my investments still continue to pay dividends then I'm not worried about a sudden fall in capital growth. If they stop paying a dividend then I need to rethink and may have a problem which is why you diversify so not all your eggs are in one basket.

An annuity gives you certainty over your income (as do DB pension schemes)

I agree.

Many who are 'risk averse' dont take this into account. If you are holding assets for 10 years or more that pay reliable, even increasing dividends, the capital value can rise or fall and not affect you too much. If and when you want to sell, with a reliable income you can time it for when the market isn't down.

atush

Francesca7777 wrote: »

But I wasn't looking for advice, or I would've asked for it! Hello??!

And I'm not bitter about my situation! I'm cool with it! Yet another ASSUMPTION from you!

If you re-read my posts I was fine and jolly and friendly until you wound me up with your intrusive questions and patronising attitude.

Just a word of advice (even though YOU never asked for it!!!), never work with the public - it's clearly not your strong suit... in MY humble opinion...

Let's leave it there I reckon...

I have and did. And was successful.

Sorry I was intrusive, but go for your enhanced annuity and/or 100% pot. you will at least have the heads up on what you will be expected to give up.


Good luck to you. Very sincere best wishes.

lvader

Back to 'that' question. After you have taken the 25% tax free lump sum there won't be a restriction on taking the rest subject to income tax. It would be 2 transactions and done in that order.