Pension Numpty!

gadgetmind

My tuppeneth, take it or leave it.

Aegis wrote: »

I just felt rather irritated at having everything I've contributed to this thread summed up as "talking rubbish"

I agree with you here. Such language wasn't appropriate given the valuable contributions you make to these forums, or even otherwise.

because someone didn't like one piece of terminology which is widely used and understood (irrespective of whether it is technically correct, which is of course the subject of this current debate).

I disagree. I'd err of the side of you being more or less wrong, but TBH the phrase isn't widely understood, and the fact we're arguing about it, suggests that throwing "maximum" in there makes it even more ambiguous.

However, we can all learn from disagreements, but need to avoid being disagreeable in the process.

atush

Well I dont understand it or ever use it lol.

Not my area of expertise.

And yes, Rubbish was a wee bit harsh

jem16

Aegis wrote: »

I'm quite happy to debate this and learn, I just felt rather irritated at having everything I've contributed to this thread summed up as "talking rubbish" because someone didn't like one piece of terminology which is widely used and understood (irrespective of whether it is technically correct, which is of course the subject of this current debate).

As I said, I think the use of "rubbish" was unnecessary. However I don't think it was being used for everything that you wrote as it did seem to make it clear that it was your use of the word marginal. It's always better to disagree in better terms though.

Actually I would argue that this is incorrect. If you earned exactly £150,000 of gross income, your marginal rate of tax would be 45% (i.e. the next £1 of income would be taxed at 45%.

Correct.

In actual fact, you are taxed in this instance at the rate of tax on the last £1 of income received, which would be 40%. By the strictest definition, this is not the marginal rate of tax.

If you earned £150k exactly you would have paid 40% tax. If you earned £150,001 you would pay 45% tax on the £1. So yes 45% is your marginal rate of tax, not 40%

Am I misunderstanding what you're saying?

On the other hand, any income received at that point would be paid at your marginal rate of tax (45%).

Of course it would, just as normal PAYE earn income would be.

I actually don't disagree with him, and I think I expressed this above. My only real distinction is that I view income as collections of payments received rather than as a singular conglomerate.

No problem there.

As such, when I say "at your marginal rate" I'm simply stating that each £1 payment making up that income is taxed at your marginal rate given all the payments which have gone before, which is definitional.

You may be stating it but unfortunately you are still wrong in its definition.

Addressing your point I have looked into it today and remain convinced that my usage is correct (if redundant at times) based on how I understand and describe the tax system working. If I wanted to be very pedantic, I could eliminate "highest" and express income as being taxed at your "marginal rate(s)", but that just looks clunky to me.

Sorry Aegis but your usage is simply wrong even if you eliminate the word highest. The only pension income that is truly taxed at your marginal rate is the state pension deferred lump sum as it will never take you into the next tax band and thus pay a higher rate of tax. All other pension income has the capability of doing exactly that so it is incorrect to state that it will be taxed at your marginal rate.

xylophone

http://www.accaglobal.com/uk/en/discover/cpd-articles/taxation/fa14-marginaltax.html

might be of interest.

happyandcontented

I have asked the FS provider for a transfer value and a projection for what that fund my give at retirement. I think, from what I have learned on here that I will leave it as is though.

I got an up to date statement from my current company pension and the pot now stands at £105,000, bringing the total of the three pots (excluding the FS aspect) to £225,000.

Any further advice welcome.

jem16

happyandcontented wrote: »

I have asked the FS provider for a transfer value and a projection for what that fund my give at retirement. I think, from what I have learned on here that I will leave it as is though.

Good to find out though. Let us know when you do.

I got an up to date statement from my current company pension and the pot now stands at £105,000, bringing the total of the three pots (excluding the FS aspect) to £225,000.

Any further advice welcome.

As the IFA you have seen would be charging you £6750 minimum for reviewing these pensions plus letting you do all the legwork in finding out the basic information, you should probably make an appointment with another one or two advisers to see what they would do/charge.

gadgetmind

jem16 wrote: »

As the IFA you have seen would be charging you £6750 minimum for reviewing these pensions plus letting you do all the legwork

Of course, you could also spend £30 on a few books, and a few hours reading the monevator web site, and then decide that moving such a large lump of money from your pension fund to someone else's doesn't make great sense.

justme111

gadgetmind wrote: »

Of course, you could also spend £30 on a few books, and a few hours reading the monevator web site, and then decide that moving such a large lump of money from your pension fund to someone else's doesn't make great sense.

I do not think a couple of books and a few hours on monevator will work for OP. And not because he is intellectually challenged but because I do not think it is realistic to expect. So at the end of it he will be unsure and stressed about taking wrong decisions. He already knows an ifa he trusts - probably most sensible for him is to go with an ifa.

zygurat789

Aegis wrote: »

This isn't always the case. "I travelled to London at the speed limit" is perfectly valid, and you would rightly expect that the limit would change depending on where you are. A singular can describe multiple outcomes under some circumstances, and I believe this is one where it obviously must do so.

No, your English is imprecise, it should read "I travelled to London at the speed limits" since there is more than one speed limit. Your example is, therefore, not valid and your argument fails.
Singular is singular and plural is plural, the point of language is to convey a precise meaning, people are imprecise.

gadgetmind

justme111 wrote: »

I do not think a couple of books and a few hours on monevator will work for OP.

That's for the OP to decide, and they won't be able to make an informed decision until they have acquired the information.

He already knows an ifa he trusts - probably most sensible for him is to go with an ifa.

Well, given how much the IFA wanted to charge, perhaps that trust isn't as solid as before.That the OP came here suggests the trust certainly isn't absolute. And surely knowing a little on the subject of investing can only help one get the best from an investment professional?

TBH, the mere suggestion that someone wanted a percentage of my pot would have now* me running for the hills.

(* - I was young and foolish!)