40something emigrating pension issue

Nicop

Dear All, I am a 40ish person who emigrated to the EU some two years plus ago.

I have my own business and France, house etc, and no plans to ever return.

I do have a sizeable private pension pot C. 200k in the UK and tried in vain before I left the UK to release it. Is there anything I can do to release this money? Will Brexit affect this? I paid into the corporate system for 15 years and now have no wish to be involved or keep paying into the fund, as I will have to live to be 160 years old to see a return! Much rather invest in France and forget the seemingly doomed and corrupt uk pension markets, any ideas welcome

AnotherJoe

What is the pension ? Is it one from and with a previous company, or a SIPP, or something else ?
Is it a Defined Contribution scheme or a Defined Benefits scheme ?

If as you say it's a private pension, eg a SIPP or similar you can control how the investments are held and right now can buy all EU based investments or even French company shares should you be reckless enough to put all your pension eggs in one basket.

No idea what you are on about needing to live to be 160. Is this hyperbole or do you genuinely believe this in which case you have simply misunderstood something.

sandsy

You no longer have to pay into it.

But as a 40ish something person, you must realise that as it's a pension, it's unavailable to release until minimum pension age which is currently 55. If you try to release it before that, you will take a huge tax hit and effectively lose the benefit of the tax relief and tax free roll up which got the value to its current size.

If it's a defined contribution pension pot, the investments should continue to grow until you need to access them. If it's an old defined benefit scheme, the benefits will be revalued each year so they retain their real value, in line with inflation. So you really have nothing to gain by trying to release them early and paying the tax.

Also, after a period of just 2 years overseas, I would be a bit more circumspect on where you might end up by the time you reach retirement.

bigadaj

Nicop wrote: »

Dear All, I am a 40ish person who emigrated to the EU some two years plus ago.

I have my own business and France, house etc, and no plans to ever return.

I do have a sizeable private pension pot C. 200k in the UK and tried in vain before I left the UK to release it. Is there anything I can do to release this money? Will Brexit affect this? I paid into the corporate system for 15 years and now have no wish to be involved or keep paying into the fund, as I will have to live to be 160 years old to see a return! Much rather invest in France and forget the seemingly doomed and corrupt uk pension markets, any ideas welcome

You could approach some very dodgy offshore schemes proposing exotic investments and qrops arrangements. Most if not all of your money will be lost but you'd release the money, though please note this would be a stupid thing to do.

Though statements like living to 160 just make you look stupid, there's plenty of information available on the web, including this site, about what is and isn't allowed and what might be worthwhile and advisable.

You appear to have moved out of the U.K but still be a daily mail reader at heart.

lisyloo

You cannot release it until either you reach a certain age (min 55 but might be higher), die or are terminally ill with < 12 months to live agreed by at least 2 doctors.
So basically that's a NO.

You should have investment choices including outside the UK.
You should also be able to transfer the pension but this requires careful consideration of the visits and benefits. If you transferred to a SIPP you can make investments yourself, however make sure you aren't giving up valuable guarantees first. For example a scheme that guarantees to pay a pension until you die may be a very valuable benefit.
You may need to take financial advice, but it's likely you have investment choices in your current scheme.

Nicop

Thanks to all, I just have to point out I have never read the daily mail in my life, i might be a dyslexic honours university graduate, but I am not stupid. I moved to Europe to escape the corporate drudgery of my UK life. Private schools at 20+ k a year, no hope of ever retiring as the population ages and house prices increase, my kids will have had no chance in 10 years when they leave university 100k in debt and the average house price over 300k. These are my personal feelings, the commentary regarding political leanings over my newspaper reading is a bit dim.
All I wanted to know was if there is anything I could do, and whether Brexit will change that, although I am a keen eurofile, the choice is up to the UK, I will not be voting as I don't live there any more.
My pension pot looks as though it will be worth peanuts a month unless I continue to contribute, which I choose/ am not able to as my lifestyle has changed. I have a chronic illness, but it will not kill me in the shot term, sorry daily mail readers. Norwich Union who manage my pot gave me an estimate of £400 per month once I am 70. Even I can do the maths. Would be much better for me to buy some property or private investments for my family, rather than wait for a pot I may not live to see. Thanks for those who understand

Nicop

bigadaj wrote: »

You could approach some very dodgy offshore schemes proposing exotic investments and qrops arrangements. Most if not all of your money will be lost but you'd release the money, though please note this would be a stupid thing to do.

Though statements like living to 160 just make you look stupid, there's plenty of information available on the web, including this site, about what is and isn't allowed and what might be worthwhile and advisable.

You appear to have moved out of the U.K but still be a daily mail reader at heart.

What sized !!!! are you to cast such aspersions on people regarding what comment, I suspect large, but I am happy to be proven otherwise

AnotherJoe

Nicop wrote: »

Thanks to all, I just have to point out I have never read the daily mail in my life, i might be a dyslexic honours university graduate, but I am not stupid. I moved to Europe to escape the corporate drudgery of my UK life.

The UK is in Europe and will remain so even if Brexit occurs. Continental drift may change this in a few hundred million years (by which time your pension will have more than paid for itself)

Nicop wrote: »

Private schools at 20+ k a year, no hope of ever retiring as the population ages and house prices increase, my kids will have had no chance in 10 years when they leave university 100k in debt and the average house price over 300k. These are my personal feelings, the commentary regarding political leanings over my newspaper reading is a bit dim.

Yep, definitely you are DM material even if you dont read it.

Nicop wrote: »

All I wanted to know was if there is anything I could do, and whether Brexit will change that, although I am a keen eurofile, the choice is up to the UK, I will not be voting as I don't live there any more.

Nicop wrote: »

My pension pot looks as though it will be worth peanuts a month unless I continue to contribute, which I choose/ am not able to as my lifestyle has changed. I have a chronic illness, but it will not kill me in the short term, sorry daily mail readers. Norwich Union who manage my pot gave me an estimate of £400 per month once I am 70.

You've misunderstood something since £200k now would buy someone aged 70 in ill health far more than that, at least £1,000 a month probably 50 -100% more. £200k now in say 25 years would be worth around £500k so the pension would be about £2,500/month (this doesn't account for inflation, but whatever...)

You also can almost certainly move your money out of NU right now into somewhere else, where you could invest it all in Michelin if you wished,and certainly in the EU excluding UK, and gain access to it at age maybe 56 or 57, when you can do what you want with it, withdraw cash as you see fit (subject to taxation but with judicious withdrawal that would be minimised).

I'd be surprised if you cant invest it in funds outside the UK right now even within NU (though you haven't given any details on what type of pension it is, as university graduate I thought you'd be able to determine that.


Unfortunately being a university graduate did not seemingly give you the ability to do a bit of research or question what you've been told.

If I can be so bold, your opening question, instead of being interspersed with hyperbole, inaccuracies (you did not emigrate from the EU) and prejudice would have been something along these lines ...

"Hi, I'm aged 45 and have a personal pension with Norwich Union, current value £200k.
They are quoting me a miserly £400 a month pension at age 70. How can I improve that?I"m also paying into it ever month, do I still need to do that?

Ideally, as I'm in ill heath I'd like to gain access to it as soon as possible, likely ages 56 or 57 depending what the government does about minimum access to pension age, since I've researched and know you cant access pension funds below a defined age apart from dodgy overseas-based schemes that will rip you off and most likely lead to losing all your money.

In case it makes any difference, I currently live in France, own a property there and have no plans to return to the UK. Thank you."

sandsy

The numbers you've quoted don't add up. If your pot is already worth £200k, it will continue to grow and should produce more than £400pm by the time you're 70, even allowing for the fact that the income is quoted in real terms.

Did you get a full projection from them? What growth rate did they use on your pot? What annuity terms did they use, eg. Single life or joint life, level or increasing?

xylophone

Under current rules, you would not be compelled to wait to access your pension until age 70 and would not be compelled to buy an annuity.

It might be possible to transfer your UK pension to an overseas scheme https://www.gov.uk/transferring-your-pension/transferring-to-an-overseas-pension-scheme

but you would be well advised to consult an IFA expert in the regulations in both countries.

Example http://www.spectrum-ifa.com/financial-advisor-france/

atush

Nicop wrote: »

Thanks to all, I just have to point out I have never read the daily mail in my life, i might be a dyslexic honours university graduate, but I am not stupid. I moved to Europe to escape the corporate drudgery of my UK life. Private schools at 20+ k a year, no hope of ever retiring as the population ages and house prices increase, my kids will have had no chance in 10 years when they leave university 100k in debt and the average house price over 300k. These are my personal feelings, the commentary regarding political leanings over my newspaper reading is a bit dim.
All I wanted to know was if there is anything I could do, and whether Brexit will change that, although I am a keen eurofile, the choice is up to the UK, I will not be voting as I don't live there any more.
My pension pot looks as though it will be worth peanuts a month unless I continue to contribute, which I choose/ am not able to as my lifestyle has changed. I have a chronic illness, but it will not kill me in the shot term, sorry daily mail readers. Norwich Union who manage my pot gave me an estimate of £400 per month once I am 70. Even I can do the maths. Would be much better for me to buy some property or private investments for my family, rather than wait for a pot I may not live to see. Thanks for those who understand

At 200K, you could have an income (if you retired now) of 6000-8000 GBP per annum, while keeping your pot size intact (ie not drawing down capital). Does that sound like peanuts? Not to me?

In fact, if invested with enough diversification you would see this pot grow significantly over the next 15+ years. So no, you really dont need to release it at all.

But you may want to make sure it isnt heavily weighted to UK assets as you say you willl not return. So do look at your investments.

AS regards Brexit, AFAIK, you can indeed vote (postal vote) as you only left 2 years ago. those who have been gone for 15+ years cannot vote.