What does the Chancellors pension revolution mean for us?

Thrugelmir

billozz wrote: »

not sure what db/fs means but the pension is a private pension that only has about £18000 in it so not worth getting an annuity. thanks for the reply

Do you need to start drawing the money now?

billozz

tbh i do really but if i have to leave it until next year so be it dont have a choice really, or do i ?

atush

Well if over 55 you could get 25% tax free now, but you might have to transfer your pension to do it?

If this is your only pension why do you need it now? What will you live on for the next 30 or 40 years?

billozz

well im hoping to get a bit of a state pension, and do you really think £18000 as an annuity would help me to live for the next 30-40 years lol

Fast_Muchly

To be honest isnt the best thing about these changes that we can take the whole amount and leave the bulk of it to our children surely ????.

I will prob have around 150'000 come retirement maybe more.

Tell me if i am doing this wrong or just being thick.

But surely a plan of taking 25% free of tax and then as much as you need to buy a modest house to rent out.

The poorest house round here get rented for £400 a month and thats not far off annuity rates for 100'000,with the added incentive off when i die the money will go to my daughter instead of the company keeping it.And yes the tax man will get a bite.....but the point is my daughter gets the biggest bite and a helping hand in life.

Tell me where im going wrong please with this idea.

gadgetmind

billozz wrote: »

well im hoping to get a bit of a state pension, and do you really think £18000 as an annuity would help me to live for the next 30-40 years lol

30-40 years after state pension kicks in? Isn't that a trifle ambitious?

What's your plan?
1) Continue to add to this pot until SP age (or just before) and then plan how to use it to make retirement more pleasant?
2) Grab the money, pay a load of tax, spend what's left on ???, hope retirement sorts itself out, somehow?
3) Fill in your plan here!

chucknorris

Fast_Muchly wrote: »

To be honest isnt the best thing about these changes that we can take the whole amount and leave the bulk of it to our children surely ????.

I will prob have around 150'000 come retirement maybe more.

Tell me if i am doing this wrong or just being thick.

But surely a plan of taking 25% free of tax and then as much as you need to buy a modest house to rent out.

The poorest house round here get rented for £400 a month and thats not far off annuity rates for 100'000,with the added incentive off when i die the money will go to my daughter instead of the company keeping it.And yes the tax man will get a bite.....but the point is my daughter gets the biggest bite and a helping hand in life.

Tell me where im going wrong please with this idea.

Do you really want to be an inexperienced landlord in retirement? We have 8 investment properties (I'm 56 and have been a landlord for over 23 years) and although they are profitable, I really don't want to be dealing with tenants for that much longer (maybe 10 years). Don't get me wrong, if you treat tenants well and give them priority, most of them respond well, but don't you think that you deserve to give yourself priority and enjoy the last years of your life?

atush

billozz wrote: »

well im hoping to get a bit of a state pension, and do you really think £18000 as an annuity would help me to live for the next 30-40 years lol

Th income oin 18K pre annum could be say 5% if invested. Which would provide an extra 75 qid a month to suppliment that pension. Given planning to live on state pension is planning to be poor do you think that an extra 75 quid a month could help? It certainly would nto hurt. And that is today's figure. You have more than 10 years before State pension age to see it grow with investment returns. Tax free.

Instead of planning to raid your pension next year, why not pay as much in each month as you can? Otherwise you are going t o be working for a very long time.

atush

Fast_Muchly wrote: »

To be honest isnt the best thing about these changes that we can take the whole amount and leave the bulk of it to our children surely ????.

I will prob have around 150'000 come retirement maybe more.

Tell me if i am doing this wrong or just being thick.

But surely a plan of taking 25% free of tax and then as much as you need to buy a modest house to rent out.

The poorest house round here get rented for £400 a month and thats not far off annuity rates for 100'000,with the added incentive off when i die the money will go to my daughter instead of the company keeping it.And yes the tax man will get a bite.....but the point is my daughter gets the biggest bite and a helping hand in life.

Tell me where im going wrong please with this idea.

TBH it sounds a bit thick.

You have a 150K pot. Only 37500 is tax free. then other 112500 is taxable as income. strip out your PA and you have 102K taxable. 32K at basic rate, 70K will be taxed at 40%- that is a loss of pension money of 28K on just the 70K Absolute madness.

Then you are talking have all your cash tied up in a property which could be damaged by tenants, the tenants could stop paying their rent- sure you can evict them but it could take 3 months and some money. In the mean time, what money is coming in?

Instead you could be looking at in income of abt 6% or so (depending on if you will run the pot down slightly over time) so abt 9K which is under your personal allowance.

Or you could take the tax free LS and put in a S&S isa and then live off the 112K and take your full PA each year tax free.

ognum

chucknorris wrote: »

Do you really want to be an inexperienced landlord in retirement? We have 8 investment properties (I'm 56 and have been a landlord for over 23 years) and although they are profitable, I really don't want to be dealing with tenants for that much longer (maybe 10 years). Don't get me wrong, if you treat tenants well and give them priority, most of them respond well, but don't you think that you deserve to give yourself priority and enjoy the last years of your life?

Interesting response, I to have investment properties, it is because of my investment properties that I can give myself priority.

I have good letting agents (tax deductable) who handle my properties well. I am out of the Uk for a good bit of the year, they deal with all the issues but do refer to me.

We also have good pensions and other investments but I would not say having property is any kind of problem.