Calculating Pension Pot

sandsy

BookerTee wrote: »

Well that sounds like I will have no choice but go through an IFA to transfer. Although the £30k pot size limit sounds more like the FCA protecting income for their members than protecting consumers.

However I am still no further forward really, I still dont know exactly what I should be asking or what good it will actually do me as the key figure is the value of the pot.

Ehhhh?

The FCA don't have any members. They regulate financial advisers to ensure that consumers like you receive suitable advice. Advisers who get caught breaching FCA requirements may be subject to enforcement action and fines.

The requirement to take advice when giving up safeguarded benefits worth at least £30k was introduced by government, not by the regulator. It's there to protect you against yourself and, in this case, sounds like it's needed.

xylophone

The FCA don't have any members

Not strictly true if it is a Company Limited by Guarantee?

But on the broad point, the FCA 's responsibility is to protect consumers, not itself or its members.

BookerTee

PensionTech wrote: »

Ok - but pension investment in property is restricted.

But why a SSAS? How have you even heard of SSASs? It's a weird product. And it is a pension. It is definitely a pension. There seems to be some confusion about that. You would need to set it up through an employer as an occupational scheme. It would need to be governed properly - the administrator/provider is not "just a caretaker role" for compliance, not in the slightest. HMRC and the Pensions Regulator would not be happy with that. This is really important, especially if you yourself don't know how you're allowed to invest your pension. If your goal is just to be in control of your investments, why not a SIPP or other personal pension, from an insurer? That's what personal pensions are for, and there will be an awful lot less governance risk.

Direct investment in property has some restrictions however an indirect investment via a loan to a company would be possible.


I wouldn’t claim to be an expert on SSAS’s but I view them as a pension scheme with a very thin shell i.e you can invest money they contain quite easily. You can also, most importantly, invest in a host of things not normally allowed by a SIPP or any other scheme. The only reason they seem a ‘weird/unusual’ product is because they are used to invest in things outside of FCA control. They are therefore largely ignored by IFA’s and the industry as they cannot make any money out of them!

PensionTech wrote: »

Ok, I understand the 9% thing now. But hopefully my and jamesd's comments have explained why you shouldn't really be looking at the final salary pension growth; rather, you should be looking at the transfer value, whatever that comes out as, and what the growth would NEED to be in order to get you an income in retirement as good as your final salary pension. If that level of growth is achievable with an acceptable level of risk (and this is important, as there's next to no risk with your DB pension), then it might be a good idea to transfer. If not, then maybe not.

Yes all the fund growth between now and retirement age is just to get me a measly £10-12k (value) a year!

PensionTech wrote: »

Phew. I wish I was in a position where a guaranteed income of £10k every year for the rest of my life was no big deal!

That would be impressive if it was age 20 onwards! but it doesnt start until your early 60's. If you live another 20 years you would be lucky to get your pension pot amount back.

I could invest 100k in a property deal, get all of that back after 1 year plus 20k return, plus 10k revenue every year, then repeat the following year.

The rush was only the desire to get on with the process, my experience so far with Mercer is zero progress...
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BookerTee

sandsy wrote: »

Ehhhh?

The FCA don't have any members. They regulate financial advisers to ensure that consumers like you receive suitable advice. Advisers who get caught breaching FCA requirements may be subject to enforcement action and fines.

The requirement to take advice when giving up safeguarded benefits worth at least £30k was introduced by government, not by the regulator. It's there to protect you against yourself and, in this case, sounds like it's needed.

'Members' was a euphemistic term rather than literal, they all belong to the same 'industry' and one is looking after the interests of the other.

I am sure the government introduced the rule due to pressure/lobbying from the FCA protecting its market. The £30k starting point is ridiculously low making it look like it was set simple to catch as many people as possible...

PensionTech

Yes all the fund growth between now and retirement age is just to get me a measly £10-12k (value) a year!

I made those figures up just for illustration. I've no idea what your actual pension will be. I don't understand what you mean by "(value)" - £10k a year is surely unambiguous in its meaning. And how do you know that's measly growth if you don't know what the underlying transfer value, the value that will grow, is right now?

Direct investment in property has some restrictions however an indirect investment via a loan to a company would be possible.

I think you're mistaken about that. This is from HMRC:

An unauthorised payment will occur if the scheme invests either directly or indirectly in taxable property that is either:
residential property - such as a building or structure used or suitable for use as a dwelling and associated land
tangible moveable property - things you can touch and move for example cars and vans or office furniture

I'm aware that (limited) loans to sponsoring employers are allowed but it does seem like you'd fall foul of this restriction if that loan is effectively an indirect investment in taxable property. Only full disclosure of your plans to HMRC will confirm either way - if you plan to go ahead with this, I suggest you make sure you get their input in writing before doing anything or you could fall on the wrong side of the law.

I would not touch this with a bargepole. You'll need an IFA to give you advice on the transfer, so good luck finding one who will.

kidmugsy

BookerTee wrote: »

I could invest 100k in a property deal, get all of that back after 1 year plus 20k return, plus 10k revenue every year, then repeat the following year.

Or you could lose the lot. But since you are a man who knows what the future will bring, go ahead.

xylophone

You'll need an IFA to give you advice on the transfer, so good luck finding one who will.

https://forums.moneysavingexpert.com/discussion/5458420

coyrls

BookerTee wrote: »

Any investments made through the SSAS would only be under my control. The SSAS administrator would only be a caretaker roll for HMRC compliance.

The brief outline of SSAS here http://adviser.royallondon.com/pensions/technical-central/information-guidance/investment/ssas-versus-sipp/ states that:

The duties of a trustee/scheme administrator include:

• registering with The Pensions Regulator and providing a regular scheme return (unless it's a single person scheme)
• registering the pension scheme with HMRC,
• operating tax relief on contributions under the relief at source system,
• reporting events relating to the scheme and the scheme administrator to HMRC,
• making returns of information to HMRC,
• providing information to scheme members, and others, regarding the lifetime allowance, benefits and transfers,
• paying certain tax charges.

AnotherJoe

BookerTee wrote: »

’I could invest 100k in a property deal, get all of that back after 1 year plus 20k return, plus 10k revenue every year, then repeat the following year.

In that case why are you so concerned about this money? Surely with the time and effort you've spent so far on it you could have made more money by property trading or whatever it is you are doing ?

You could do this every year compounding each years gains, and be making millions a year within a short time, so this money would be an utter irrelevance.

BookerTee

kidmugsy wrote: »

Or you could lose the lot. But since you are a man who knows what the future will bring, go ahead.

There will always be the naysayers who pour scorn and derision on anything they dont understand.