Pension last few questions

ABN

Since my present Pension Company is not offering Flexible Drawdown I need to change company.

If I change provider, take my 25% tax free sum and start the drawdown should I not be happy with that provider and/or find a better one. months/years later can I move to a new provider and start a new drawdown pension? (I know I cant take another tax free lump sum)

Since I am risk adverse will be holding the pension as cash. What protection does that monies have should either the pension company or bank where the monies are being held goes bust?

dunstonh

should I not be happy with that provider and/or find a better one. months/years later can I move to a new provider and start a new drawdown pension?

You just transfer it. The fact it is crystallised doesnt make any difference.

Since I am risk adverse will be holding the pension as cash.

That is quite a risky option. You appear to be introducing different risks which are almost guaranteed to happen to avoid risks that may happen.

What protection does that monies have should either the pension company or bank where the monies are being held goes bust?

Ask the provider

jamesd

ABN wrote: »

Since I am risk adverse will be holding the pension as cash.

That's a risky approach. You're pretty much accepting losing money to inflation each year. Even at only 2% inflation you'd lose 18% of your money over ten years, assuming you get the typical around 0% interest for holding cash in a pension pot. What you're doing is trading uncertainty about investment growth for the certainty of losing money to inflation. Over the long term , on average, that's a bad move.

What it is worth doing is considering which risks bother you and how to deal with them. for example, you can take a 25% tax free lump sum. You could invest that in peer to peer investments, which can pay anything from 4% to over 10% depending on the place. All with low up and down price movements.

You could do the same with some of the money from the 75%, bearing in mind that it'll be taxed as income when you take it out, so you need to not just do it at a high rate or you'll pay a lot of avoidable income tax.

So, longer term, you need a better plan than cash and options for that without the routine ups and downs of value do exist, including those that wouldn't suffer much if there was a big equity market drop.

kidmugsy

ABN wrote: »

Since I am risk adverse will be holding the pension as cash. What protection does that monies have should either the pension company or bank where the monies are being held goes bust?

It would probably be wiser to invest in a few investment trusts or funds that put preserving your capital as their highest priority - so Ruffer Investment Company, Personal Assets Trust, Newton Real Return Fund, Standard Life GARS are among the possibilities.