pension advice

rabbit_2

Hi,
I have recently been informed by scottish equitable that my penion with profits policy is due for drawing in january. but due to circumstances i will not be retiring then. They have gave me the option to defer with 2 options1/ putting money in there cash fund 2/ putting it in a unit linked fund which i am temped to do as it is not as large amout as I was expecting. I know I should get in touch with a financial advisor but does anyone know if I put it in a unit linked fund how long does it have to stay in, can it be a fixed term or a variable term and what charges would apply i would appreciate any advice.

Cheers Rabbit

dunstonh

Is it a section 32 buy out bond, Section 226 retirement annuity contract or a personal pension?

rabbit_2

it is a personal pension
rabbit

EdInvestor

Normally if you defer your pension, you can choose how long to defer it for - rolling it over every year may be a good idea.

As the pension is in a Withprofit fund now, it's probably wise to move it out now that it is maturing, as you might be subject to penalties otherwise.

The new maturity date you choose isn't relevant to what the money is invested in.

You should ask them about the charges and also about the fund choices.A selection of funds may be better than just one.

BTW it is not necessary to retire to draw money from a pension fund.Many people find it useful to take the 25% tax free cash out to reinvest eleswhere and leave the rest to grow until they need the income.If you wanted to do that, you would need to move the money to "income drawdown", typically by transferring to a SIPP.

dunstonh

Scot Eq have an awful lot of plans with guaranteed annuity rates. You need to get this verified and what ages and rates and methods of taking the money are available.

Their GARs at 65 are typically in double digits whereas open market is closer to 7% for men.

EdInvestor

Yes indeed, check for a GAR.If there is one, it may mean you should take the money in January or you will lose it.