What to do

Audaxer

keat63 wrote: »

The point I'm really getting at, is it's pretty much worthless as a pension fund.
If I take it now, It will pay me pocket money.

I think you are misunderstanding the points made as you are thinking that taking it as a monthly pension now means an annuity which I agree wouldn't pay much on a fund of £26k. So you are thinking it would be better to take it all in cash now, but as others have pointed out that would mean paying a heck of a lot of unnecessary tax.

The thing I think you're missing is that if you transfer it to a more flexible pension invested in a standard balanced fund, in 15 years time the pension value would most likely be significantly more than at present. When you want to then access the money, with your other income at that time you may be below your personal tax allowance, so you could draw out as much income as you need each year paying little or no tax.

atush

If I transfer it, and wait another 15 years, it will still only be worth beer money at best.

That depends entiirely on you and your choice of investments. Some years our pensions are up 20%.

The point I'm really getting at, is it's pretty much worthless as a pension fund.

It isnt. Your understanding seems to be worthless. The projuections you have been given are for a conservative annuity. Will you be buying an annuity? I wont be (at least this side of 75).

It will grow over time in line with what you invest it in. then, when you retire, you transfer all your pensions into one DD scheme where you take money as and when. So your eventual pot will be raised 26K plus all the growth between now and then. That isnt beer money, it is champagne everyday money.

You really need to read up on the basics of pensions.

System

So I just got off the phone with Prudential and I can leave the fund where it is.
They basically are moving my retirement date to 58.
I can then decide what I want to do in 2021.

The letter is very misleading, and without doubt gives the impression that I'd have to take it today.
I've suggested that someone ought to review the letter, and reword it slightly.

Thanks for your input folks.