Question about transferring DB / DC pensions

Skwizz

Cheers Pip,

I hadn't as I'm afraid I wasn't quite as convinced about my calculations as my spreadsheets had been (/are).
I didn't want to risk putting any of my wealth out of reach, just in case.
I have just re-started my SIPP contribution (March, last tax-year).
I have no taxable incomes so, having withdrawn from a pension already, as you mention my new allowance is £2,880.00 which the govt kindly tops up to £3,600.00.

I have been drawing from the SIPP since 2016 and then topping up income from my ISA.
Although I started early with my ISA, I failed to spot the real advantages until 2007.
Since then I've used my maximum ISA allowance every year.
Compound interest and good investments has done the rest.

I always paid BR as well and my personal circumstances didn't really make my SIPP that much more effective than my ISA for tax efficiency.
The ISA (according to my calculations) should have a greater advantage over the long term, for ME.
I prioritised my ISA, over my SIPP, and my pension totals won't ever reach the LTA.

I'll get a full state pension in Feb 2026 and the two smaller company pensions, which I now realise are both DB.
I haven't decided about deferment yet
I will probably be unable to avoid a personal income tax liability then.

I also plan, between then and when I hit 75 in 2035, to convert the rest of my SIPP to drawdown and take my 25% tax-free lump-sum.
The rest will be 'forgotten' and left for my heirs,
I will live solely from my State pension, the two DB pensions, and then I'll continue to top-up my income from my ISA.
I'm aware the SIPP would have been a better inheritance vehicle than my ISA, but that's the way I want to do it and my heirs should be happy enough with my arrangements anyway;
As my SIPP is relatively small my ISA growth easily outperforms it so I'm drawing as little from that as I can, while I can..

I might also run the SIPP down completely before my state pension kicks in, allowing ISA to grow for longer.
That would leave me with 20% tax liability though, unless I mess up the timing and go into the Higher Rate band (in which case I would leave it).

I manage all my own investments myself and do so entirely from within my SIPP and ISA, both on H-L.
I use H-L as my investment platform, but I wouldn't use them for financial advice thx.
In the next few years I'll consider seeking professional advice again.
I've already identified someone in Alton, Hants.

Good luck with your plans.

Dazed_and_C0nfused

I'll get a full state pension in Feb 2026 and the two smaller company pensions, which I now realise are both DB.

Given you fall under the transitional rules have you checked your State Pension forecast (in full) to make sure of what you have accrued to date, usually shown to 5 April 2021 at the moment, and whether you need to buy any additional years to reach the standard new State Pension amount?

pip895

Skwizz said:

I use H-L as my investment platform, but I wouldn't use them for financial advice thx.
In the next few years I'll consider seeking professional advice again.
I've already identified someone in Alton, Hants.

I would definitely not suggest using HL for advise - luckily we didn’t need it in order to transfer DC pots with no protected rights.  They seemed very efficient at that process, but it was quite a few years back since we used them.  

You sound as though you are well up on your pension plans - perusing and posting on this forum is great for increasing knowledge on these things.  

Re Deferring pensions - I know it is potentially worth while delaying the state pension for a few years but DB pensions vary a lot.  As Dazed.. mentioned above it is defiantly worth checking you have the Max State pension, paying for missing post 2016 NI years can be a very good move.

Finally remember that the name of the game is enjoying your retirement not minimising tax - something I have to remind myself of from time to time 😀