Approaching 55 and need some guidance

atush

Find out if you can transfer the pension to a new provider that does Drawdown but keep the pension open and continue to pay in? That is your first port of call.

If they wont do it, you may have to consider other options incl refinancing your mtg.

But first i'd attend the debt free board and see if you can cut down yoru spending, and increase your income to pay off the debt (or increase your savings if you manage to pay off the debt with some of your TFLS).

Beatle_Ray

Hello,


When you say it might not be possible to have a drawdown I thought the law was that all pensions provided that facility, if not how easy is it to transfer to one that will allow drawdown and would there be any costs or loss of investment involved, how easy would this be, would welcome any comments on this as in my mind I was looking forward to clearing all the debt and not having the burden of that any more
Thanks, Beatle Ray

mgdavid

What's the interest rate on your mortgage?
What's the interest rate on the £17k debt?

If, as I expect, the debt (or at least some of it) is a higher rate than the mortgage, then stop over-paying the mortgage and use that money to repay the debt.
Pensions are for living off once you are too old to work, not to pay off debts created in earlier years. Tough as it sounds, repaying debt is higher priority than going on holiday.

dunstonh

When you say it might not be possible to have a drawdown I thought the law was that all pensions provided that facility,

No. There is no such law.

how easy is it to transfer to one that will allow drawdown

Very easy. Most will transfer in a matter of days nowadays.

would there be any costs or loss of investment involved

Your existing pension may have exit charges but these should be reduced from March. Modern pensions tend not to have entry charges. Some have a drawdown charge but its small.

Beatle_Ray

Hi Thanks,


Not wanting to take the money for the holiday now as I realise that's not what it is there for at the moment, the cc are approx. 28% apr and the over payment on the mortgage is only about £45 a month so not making any real difference.


I plan to increase my payments into the pension from the money saved on not paying the credit cards, going to take a little time to make up the funds if I even do but I can make an attempt, just had a few unforeseen costs these past 18 months and haven't lived recklessly at all

badmemory

It may only be an overpayment of £45 per month, but that £45 per month will be far more effective being paid off your debt - around 10 times as effective in fact!

atush

the cc are approx. 28% apr and the over payment on the mortgage is only about £45 a month so not making any real difference.

That is a huge APR and 45 a month will make a difference to be sure.

So get over to the debt free board, post an SOA, and start a spending diary. Soon you will have other savings to add to the 45 and you will at least begin to make progress.

jamesd

Have you looked into getting a balance transfer credit card to cut the interest rate on some of the debt?