How Many Pensions?

Cosmic121

Hello!
Just the one simple question: I have 5 pensions and I am 55, can i draw 25% out of each tax free?

molerat

Yes ................

xylophone

They are all DC pensions that you can access now and without actuarial reduction?

Cosmic121

Super stuff thank you.
There is one other thing, I am already drawing weekly from on of them, can I still nab 25% of this one and will this simply reduce my income?

PensionTech

There is one other thing, I am already drawing weekly from on of them, can I still nab 25% of this one

Nope. You should have had the chance to do that (or something equivalent) when you started to draw from it.

Also, xylophone makes an important point - theoretically you can take 25% out of your pensions at 55, but depending on the type of pension and rules/policy conditions attached to them, you may need to transfer the pension into a different scheme in order to actually do so, which can come with additional complications, and on top of that depending on the type of pension it might not be a good idea to transfer/withdraw anyway.

Can you provide more information about how you built up these pensions? Through work? Are they defined benefit ("we promise to pay you £X from age Y") or defined contribution ("we'll invest your contributions in a pot which you'll then have to use to provide an income or draw benefits in retirement")?

Cosmic121

3 are DC, one is a SIPP and the other is my old MWPS

Cosmic121

Thank you and yes, I did take a lump sum.

PensionTech

Is that the British Gas Manual Workers Pension Scheme? Or the Mineworkers Pension Scheme? Either way, it sounds like DB.

The SIPP and DC you can probably draw your 25% now, although you'll have to check whether the provider has the facility to do so (if not, transfer to one who does) and whether there are any guarantees or underpins attached to the pension (if so, withdrawing or transferring may require financial advice, and you might be better off keeping them where they are and using the guarantees rather than taking them early). The DB you may be able to take now, but it'll be reduced for early payment, and you'll have to give up some pension to get the 25% lump sum - which may not be good value for money (it usually isn't). I don't know which one it is you already have in payment, but as mentioned before, you're stuck with it now.

The more important question, particularly with regard to your DB pension, is why you need the money now and whether it makes good financial sense to take it from your pensions at the moment.

Cosmic121

Thank you all, that has made it a little clearer. I have asked this question prior to getting advice from an investment expert tomorrow. I suspected I could withdraw from my SIPP and 2 of my work contributed pensions but was unsure about the others.

PensionTech

Do make sure that all advice is regulated by the FCA

(The words "investment expert" put me a little on edge; it could be a legitimate regulated independent financial adviser and you've just used different words to describe them, but do be aware that there are an awful lot of scammers about these days who claim to help people review how their pensions are invested in order to get them to transfer into unregulated investments in bogus schemes, and either take out massive charges or just disappear with the pension money altogether - or both. It's been a really big problem in the last few years.)

Cosmic121

PensionTech wrote: »

Do make sure that all advice is regulated by the FCA

(The words "investment expert" put me a little on edge; it could be a legitimate regulated independent financial adviser and you've just used different words to describe them, but do be aware that there are an awful lot of scammers about these days who claim to help people review how their pensions are invested in order to get them to transfer into unregulated investments in bogus schemes, and either take out massive charges or just disappear with the pension money altogether - or both. It's been a really big problem in the last few years.)

Yes, I made up that title, sorry and they are regulated by the FCA. The guy I am seeing is without doubt a professional advisor.