Having another pension pot on a DB scheme

atush

So, if your old DC pension had guarantees, you are left with sipps and personal pensions. So have a look at Cavendish and HL perhaps/

You really want to whack some in if you are paying higher rate tax. You'll get basic rate relied immediately, and will have to claim the rest off HMRC, either by telling them and they adjust your code, or by self assessment if you do one.

xylophone

So it will have a GMP attached which could be of value.

Guaranteed Minimum Pension? Not if this was simply a Protected Rights type policy?

Protected rights as such have been abolished and are now just ordinary rights.

That would make this policy equivalent to a simple money purchase pension?

The OP could possibly transfer elsewhere and add to it sufficient to reduce her 40% tax liability? Example http://www.hl.co.uk/pensions/sipp/transfer-to-the-vantage-sipp

http://www.barnett-waddingham.co.uk/comment-insight/blog/2014/08/18/what-is-a-gmp/

https://forums.moneysavingexpert.com/discussion/5072779

https://forums.moneysavingexpert.com/discussion/5093782

mgdavid

atush wrote: »

So, if your old DC pension had guarantees, you are left with sipps and personal pensions. So have a look at Cavendish and HL perhaps/

You really want to whack some in if you are paying higher rate tax. You'll get basic rate relied immediately, and will have to claim the rest off HMRC, either by telling them and they adjust your code, or by self assessment if you do one.

Absolutely! Effectively you will be putting in £60 while the new pot increases by £100. And this additional pension pot can be used to bridge the gap between early retirement and the state pension at 66 or whenever yours is.

crystal_pixie_2

I just wanted to update on the SERPs pot. After a discussion with Friends life it seems that it doesn't have any guarantees or any particular benefits. I have found out that it isn't going down but not growing as I would like.

I have also had confirmation that there are no fees for transferring out of this scheme so that is what I intend to do.

No I am thinking a simple stakeholder pension I can transfer this pot into and start saving into it is a better bet.

Thanks for HL link - very interesting but SIPPS do look a bit scarey for a novice. I have the option of buying shares through the company I work for but thats about the only experience in stocks and shares.

Thanks for the Cavandish online link rpc that looks like a possible route.

rpc

crystal_pixie wrote: »

No I am thinking a simple stakeholder pension I can transfer this pot into and start saving into it is a better bet.

For £15k, I'd expect you to be able to get a personal pension (not a stakeholder) - that gives you more investment choices and is quite possibly cheaper too.

xylophone

Thanks for HL link - very interesting but SIPPS do look a bit scarey for a novice. I have the option of buying shares through the company I work for but thats about the only experience in stocks and shares.

http://www.employeebenefits.co.uk/resource-centre/analysis/maximise-tax-breaks-by-transferring-sips-to-sipps/8030.article might be of interest.

A SIPP need not be too frightening - you could do some research -http://www.moneysavingexpert.com/savings/cheap-sipps

Otherwise http://www.cavendishonline.co.uk/pensions/transfer-your-pension/

https://www.gov.uk/transferring-your-pension/overview

And re pension tax relief as a 40% tax payer. https://www.gov.uk/tax-on-your-private-pension/pension-tax-relief

atush

rpc wrote: »

For £15k, I'd expect you to be able to get a personal pension (not a stakeholder) - that gives you more investment choices and is quite possibly cheaper too.

I agree. This op is confusing the platform with the investments. And stakeholders can be more expensive and more limiting the personal pensions.

If the investments aren't performing the way they would like, you can change them where they are. Or move them if you can find lower charges. BUT you still have to choose the investments. And to do that you need to understand what the pension is invested in now, and the choices of funds to move them to- and whyif they would do any better?

crystal_pixie_2

atush wrote: »

I agree. This op is confusing the platform with the investments. And stakeholders can be more expensive and more limiting the personal pensions.

If the investments aren't performing the way they would like, you can change them where they are. Or move them if you can find lower charges. BUT you still have to choose the investments. And to do that you need to understand what the pension is invested in now, and the choices of funds to move them to- and whyif they would do any better?

Atush - be gentle! I am very ignorant when it comes to pensions and investments - basically I have been very lucky to have a DB scheme and its not something I have had to do anything about for years. When I found out the this SERPs pot I thought now would be the best time to do something about this - especially as I have some disposable income. My only comparison from a performance perspective is looking at how my old Zurich personal pension is performing.

Xylophone thank you for the information about SIPPS and personal pensions that was really useful. I have looked at transferring this pot into the works AVC which is run by Prudential. The fees are low (0.5%) but I am being told I may still have to buy an annuity (see I am learning!). Not sure I need that? It seems to be performing well so that is another avenue.

rpc

crystal_pixie wrote: »

I have looked at transferring this pot into the works AVC which is run by Prudential. The fees are low (0.5%) but I am being told I may still have to buy an annuity (see I am learning!). Not sure I need that? It seems to be performing well so that is another avenue.

The pension is just a wrapper and doesn't "perform" at all. It is the investments inside that wrapper that perform. In the same way that cling film is still cling film whether it is wrapped around chocolate cake or mouldy bread.

My AVCs sounds similar to yours. I cannot use them for drawdown without transferring out my main scheme benefits, but they are cheap (low AMC and salary sacrifice contributions save NI).

As a result, I am making contributions to a personal pension to provide flexibility. I am also putting a small lower amount into AVCs primarily to increase my lump sum (if the PCLS survives another 25-30 years) and any leftovers can buy an annuity to mitigate against actuarial reductions or bridge the gap to state pension or whatever.

The choice of AVC vs personal pension (or SIPP or whatever) needs to be made in the context of your overall retirement planning. Every option has pros and cons and you need an overall plan that balances them all.

greenglide

The fees are low (0.5%) but I am being told I may still have to buy an annuity (see I am learning!). Not sure I need that? It seems to be performing well so that is another avenue.

You don't need to buy an annuity. It may be that Prudential have only that option to offer you but you can transfer it elsewhere when you access the AVCs. You can also buy an annuity from any provider, not just Prudential (the open market option).