Pensions am i goiing the right way?

Markinthepast

So with the introduction of work place pensions, the company I work for have taken the opportunity to simplify all the different schemes they have been contributing too and gone with one standard scheme for all employees.

Originally they were contributing to my Personal Pension Plan with Aviva.

They now started contributing to the work place pension with Standard Life.

I am 41 years old and have about 55K in the Aviva scheme.

I received a letter from Aviva stating that now my contributions have stopped I have 3 options:

Option 1
I can keep the scheme going and by contributing at the same rate via my own direct debit.

Option 2
I can stop contributing and the policy will be “made paid up”.

Option 3
I can transfer the value of the pension to my new scheme.

Option 1 I cannot currently afford to contribute at that level all though it would be nice to be able to top up the fund in the future in maybe 10-12 years when the children leave home.

Option 2 I assume “made paid up” means that the scheme stays at the same level that it is at now until I retire?

Option 3
The new scheme Standard Life does not seem to be as good as the existing Aviva scheme. I assume that there is no problem in having two schemes nowadays? Also I don’t like having all my eggs in one basket.

So it looks like I am going for option 2.
Are all my assumsions correct?
Is this the right way to go?
Will I be able to only top up my new scheme in the future?

Linton

There is no problem with paying into multiple pension schemes. But I dont know what restrictions "paid up" implies in the context of your particular pension. So it could be worth asking Aviva whether you can make further deposits.

If you have checked the charges and facilities to come to the conclusion that the Aviva one is better then it is perfectly seansible to keep it. If circumstances change you should be able to transfer it elsewhere whenever you want.

jennyjj

Markinthepast wrote: »

So it looks like I am going for option 2.
Are all my assumsions correct?
Is this the right way to go?
Will I be able to only top up my new scheme in the future?

I'd go with that 2nd option too. It gives you flexibility when you reach 55. You'd be able to draw on the paid up one even if still working and paying into the new one.

atush

I would check with aviva, but given our experience you should be able to pay into it in future.

If they say you cant, think abt putting in a min contribution to keep it open. Otherwise, make it paid up.