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It's time to start digging up those Squirrelled Nuts!!!!

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  • MallyGirl said:
    We are also not particularly thinking about inheritance tax - with just one child she will get a lot anyway even if there has been tax deducted. We are planning on living a good few years and have a full set of parents still doing well (some good for age in 80s and some just fit as a fiddle) so we will support her but prioritise ourselves for a while.
    I will be withdrawing just under the 20% threshold from DC then adjusting for the tiny DB that starts at 60, OH will be doing some LTA management and taking just under the 40% threshold. What we don't spend (if any) will go into ISAs, PBs and savings accounts.
    Sensible.

    In general principle, there is a balance between the desire to retain funds in pension wrapper until required, from IHT perspective, set against the desire to minimise LTA impact (particularly the age 75 BCE).
    I haven't researched in detail yet, but the broad plan is to deplete up to top of BR tax each year, from 55, and use any surplus in ISA / PB / offset mortgage (if not paid off).

    It's important to be aware of the broad tax implications of the strategy, but not get too wound up in the detail and end up having the tax tail wag the dog.
    Can you provide some explanation please as to what to be aware of ? Cheers
    Mortgage free
    Vocational freedom has arrived
  • @Sea_Shell ah, I understand your confusion - that paragraph only referred to the part of the pot with the discretionary fund manager.  That is £450K.

    We also have separate ISA’s, currently close to £200K between us, from which we will be drawing our “income”.  So ISAs total around £650K. 

    And then the DC pension pots, his currently £320K and mine £180K.

    Cash currently £24K, but if I get my way we’ll be spending up to £10K of that on a whizz bang solar PV and storage system plus the car charger. We have already spent about £6K on things for the house.

    So the total “pot” is <gulp> £1.17m,  and then DB plus full SP for both of us, which will give him £16K and me £20K in today’s money when all in payment, assuming no lump sum taken.
  • @ex-pat_scot thank you for that explanation, I found it helpful.

    Re the LTA - do DB pensions count towards that as well? I have a vague recollection of seeing %of LTA mentioned on one of my annual statements.

    My hunch is that we are nowhere near that, and (probably) won’t be adding to pensions now. I would hope that if it was an issue, our IFA would have mentioned it.
  • QrizB
    QrizB Posts: 18,185 Forumite
    10,000 Posts Fourth Anniversary Photogenic Name Dropper
    @ex-pat_scot thank you for that explanation, I found it helpful.

    Re the LTA - do DB pensions count towards that as well? I have a vague recollection of seeing %of LTA mentioned on one of my annual statements.
    DB pensions count towards the LTA as 20x the annual pension plus any PCLS.
    So a DB paying £10k pa plus £40k lump sum would count as [(20 x 10) + 40 =] £240k.
    N. Hampshire, he/him. Octopus Intelligent Go elec & Tracker gas / Vodafone BB / iD mobile. Ripple Kirk Hill member.
    2.72kWp PV facing SSW installed Jan 2012. 11 x 247w panels, 3.6kw inverter. 34 MWh generated, long-term average 2.6 Os.
    Not exactly back from my break, but dipping in and out of the forum.
    Ofgem cap table, Ofgem cap explainer. Economy 7 cap explainer. Gas vs E7 vs peak elec heating costs, Best kettle!
  • michaels
    michaels Posts: 29,104 Forumite
    Part of the Furniture 10,000 Posts Photogenic Name Dropper
    QrizB said:
    @ex-pat_scot thank you for that explanation, I found it helpful.

    Re the LTA - do DB pensions count towards that as well? I have a vague recollection of seeing %of LTA mentioned on one of my annual statements.
    DB pensions count towards the LTA as 20x the annual pension plus any PCLS.
    So a DB paying £10k pa plus £40k lump sum would count as [(20 x 10) + 40 =] £240k.
    Which is bargain of the century considering an equivalent annuity would probably require a DC pot of twice the size.
    I think....
  • michaels
    michaels Posts: 29,104 Forumite
    Part of the Furniture 10,000 Posts Photogenic Name Dropper
    On the question of whether it is better to move money out of a sipp into an isa, if you think the basic rate of tax may increase in the future then it makes sense to draw any out that will be subject to tax sooner rather than later.
    I think....
  • Sea_Shell said:

    Wow that's a lot of nuts!!!!  

    .........
    Retired 1st July 2021.
    This is not investment advice.
    Your money may go "down and up and down and up and down and up and down ... down and up and down and up and down and up and down ... I got all tricked up and came up to this thing, lookin' so fire hot, a twenty out of ten..."
  • Sea_Shell
    Sea_Shell Posts: 10,022 Forumite
    Tenth Anniversary 1,000 Posts Photogenic Name Dropper
    In spending news...just treated myself to a pair of North Face walking shoes.

    Usual price £115, but £75 in the Blacks sale!! 😁


    I have proper boots, but wanted something more lightweight, but still waterproof, for trails.
    How's it going, AKA, Nutwatch? - 12 month spends to date = 2.60% of current retirement "pot" (as at end May 2025)
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