Any recommendations for a good pensions book or blog?

digbydog

I'm about to retire and have been so busy saving I've given no real thought to how to pay for retirement. I've got some guaranteed income, some defined contribution pots, some ISA's (cash and funds), nothing fancy. I don't know the difference between drawdown and uncrystallised thingies! Should I spend ISA money before pensions or try and balance the two to get the most tax-efficient outcome.
Would anyone recommend a good book or blog on the subject? I want something meant for someone's in their sixties, not their thirties.
Thanks

Albermarle

You could do worse than spend some time reading through pages of old threads on this pension forum . Lots of similar questions to yours have been asked and answered.
This blog is often recommended
https://monevator.com/
( on right hand side is a guide to retirement planning )
+ the Government has a website https://www.pensionsadvisoryservice.org.uk/
and they offer free interviews/guidance  https://www.pensionwise.gov.uk/en
Plus the pensions providers websites usually have good explanations  eg
 HL. Fidelity, Standard Life , Royal London etc 

gm0

Consumer. Nothing here is advice.  At best guidance from a random stranger on the internet.

Best book I found was Living off Your Money (Michael McClung).  Very detailed. Mostly testing published academic ideas about drawdown and "how to go about it".  Complex book. And not a tax primer on UK taxes (ISA, SIPP etc.).   Good if you like to understand a recommendation and why approach A rather than B with data showing why the author has come to that conclusion.

The government sites are a good place to start to learn the language and the basic options.  But they stop frustratingly quickly and don't really address "how to" (where the book above or the blogs come in). The government calculator perhaps unsurprisingly is setup to be very conservative in its assumptions.  Pensions has a lot of assumed knowledge and a domain language - crystallisation, BCE, LTA, MPAA etc.  This forum is a good place for retail SIPP DIY "how do I / what can I expect" questions.

To your ISA/Pension question. 

You shouldn't obsess too much over the tax wrappers - ISA/SIPP/Pension.  Can and will change over 30-40 years of retirement. 

More critical to establish what you are invested in (risk + time horizon), income (fixed, variable) and how cashflow is sustained in the bumps in the road when working to fill the gap has become less attractive or impossible.  That said - a popular rough and ready rule of thumb is that pensions have a favourable inheritance tax treatment. So that for people with a) dependents b) an IHT liability this is a significant thing to consider.  Clearly what you can do depends upon what you have - pensions, ISA, property and cashflow.  But can often find that spending other savings (which are inside estate for IHT) before the pension (outside estate for IHT) can make sense as it reduces the tax bill and passes more to heirs than spending the same the other way around. Implication of this is to consume ISA before Pension.   This is also why IFAs often go pale when investment beginners take their whole 25% tax free cash up front (and move it into their estate).  Now there can be a consumption + "live long enough" and take it before regulation changes again argument for doing it but the tax argument around risk of early death is clear.  This is why the "phased FAD" recommendation is popular also.  But nothing to excess - emergency funds etc.  Everyone is different - goals, dependents, risk appetite.  These kinds of "rules" on the internet can be dangerous precisely because they don't suit everyone.  As an example someone with a large pension needs to make use of the tax years between 55 and 75 for income tax so would likely draw part of their pension to avoid tax penalties later (at 75).  Final salary/DB pensions are another whole topic again - whether to switch (mostly not) and when to take (age vs life expectancy etc. etc.).  No "suits all" guidance optimal for all combinations of pension(s) and state pension and death dates can exist.

OldMusicGuy

You should read this book by John Edwards: "DIY Pensions: A Simple Guide to Pensions, SIPPs & Retirement Planning". It's a great place to start.

The McClung book gm0 mentions is very good but it is very detailed and will bamboozle you unless you have a pretty good understanding of how pensions work.

Like Albermarle says, you should get a free appointment with PensionWise if you haven't already.

The most useful thing to do now is to create a detailed financial plan for the next 30 years so that you can establish how much money you will need, and when you will need it. Overlay any guaranteed income streams (like DB pensions and state pension) and that will help you decide when and how to take money from other sources.

Dox

You sound like an ideal candidate for proper professional advice rather than the DIY route. Maybe spend some of that hard-saved money on someone who can give advice based on a full understanding of your situation? No book can do that.

dunstonh

Consideration should also be given to not getting a book at all.  After all, a book will not tell you the best type of pension for you or the best type of investments.    They may speak generics but generic information can be wrong.

digbydog

Dox said:

You sound like an ideal candidate for proper professional advice rather than the DIY route. Maybe spend some of that hard-saved money on someone who can give advice based on a full understanding of your situation? No book can do that.

I agree and think there can be a lot of value to be had from highly qualified professional advisors. I tend away from professional advisors because I feel intimated by them! I will show my age now but they remind me of the Gramaphone Sketch from Not The Nine O'Clock News (search YouTube for 'HiFi shop sketch from not the 9 o'clock news')!

Albermarle

If you do decide to go for advice, make sure you go to an IFA ( Independent Financial Advisor) and not to your bank /building society. An IFA has no financial gain for recommending any product ( commission was banned some years ago) but instead will charge you for their time . Normally the first meeting is free but you won't get any specific financial advice at this time, more a kind of get to know you meeting.
Depending on the size/complication  of the funds/situation involved , an initial charge maybe around 2 or3 % and ongoing advice for 0.5% to 1 % 
There are endless discussions on this forum about the value of going to an IFA, or going  down the DIY route and there is no right or wrong answer. Clearly the more money is involved, the more complicated the situation and the less you feel confident in these matters all play a part. 

zagfles

If you have the time, motivation, and ability to learn, then there's loads of resources to get started, some mentioned above and they will point at other good resourses. Pensions and investments aren't rocket science even if those with a vested interest will often try to make it sound like they are. It's a bit like learning to drive. Learn the rules, use common sense, if you screw up the consequences can be severe, but most people can learn and can end up being good safe drivers.

[Deleted User]

Books are better than IFA. One - not enough; need a few. Even if you go with an IFA you need to read first to understand the advice, evaluate it and make the decision.

in addition to the above recommendations, I like Bernstein’s series on asset allocation and risks

Albermarle

Even if you go with an IFA you need to read first to understand the advice, evaluate it and make the decision.

Yes it is like talking to a garage mechanic . If you know a bit about cars you can get more value from the conversation /not have the wool pulled over your eyes.