Royal London income release

P933alilli

Hi, i have a RL private pension but to access it flexibly and take a series of lump sums i'd have to transfer it to another provider as RL do not have a drawdown product. They do have an income release product which i'm being sent info about. Any info about this beforehand would be appreciated, thanks! Also, Ive been told previously that there will be no charge for transferring to another provider. If thats the route i go down could anyone recommend any drawdown products?

dunstonh

Hi, i have a RL private pension but to access it flexibly and take a series of lump sums i'd have to transfer it to another provider as RL do not have a drawdown product.

RL do have a drawdown product.  Indeed, they were the biggest provider of drawdown in the UK in the past (I don't know if they still are).

They do have an income release product which i'm being sent info about.

Income release is not a product.  Its a marketing term they use to describe income drawdown and its available on their standard personal pension. 

If thats the route i go down could anyone recommend any drawdown products? 

Insufficient information to go on to answer that.   Most modern personal pensions and SIPPs offer drawdown.   To filter those down to suit you, more information will need to be known.   This will include how you intend to buy the pension as RL only retail via IFAs.  if you are going to use an IFA then the IFA will pick what they believe to the best option for you.  If you are not going to use an IFA, then RL will not be available to you.

P933alilli

Thanks for the reply! Im 60 , living off savings and my pension is with profits 30k'ish! I have 38+ yrs national insurance contributions so presumably qualify for full state pension @ 67. In reply to your last sentence does that mean i would need to use an IFA to use RL's income release even though my WProfits pension is already with them? My thoughts are that i want money from the pension when i want it and not pay any tax obviously but wondered if transferring to the income release would result in reduction in value, not just in terms of any cost to set it up, but with it being different in terms of what the funds are invested in and also with it not being with profits!  Could i do better elsewhere?

Dazed_and_C0nfused

I have 38+ yrs national insurance contributions so presumably qualify for full state pension @ 67.

You are under transitional rules so having 38 years doesn't mean you are guaranteed to get the standard new State Pension.

You should check what you have accrued to date on gov.uk, usually shown to 5 April 2021 at the moment.

It is important you read the forecast in full and not just the headline figure.

And no, if a COPE figure is shown you do not deduct that from either your forecast or the amount accrued to date.

xylophone

State Pension Forecast here

https://www.gov.uk/check-state-pension


https://www.royallondon.com/pensions/personal-pensions/flexibly-accessing-your-savings/

dunstonh

In reply to your last sentence does that mean i would need to use an IFA to use RL's income release even though my WProfits pension is already with them?

Yes.  Because you will be buying a new retail product and RL only retail their products via intermediaries.  Not direct to public.

y thoughts are that i want money from the pension when i want it and not pay any tax obviously but wondered if transferring to the income release would result in reduction in value, not just in terms of any cost to set it up, but with it being different in terms of what the funds are invested in and also with it not being with profits! 

It could result in a reduction in value if there is a market value reduction or it's a very old plan with an outstanding charge (more common on the Royal London plans that were ex-united friendly or CIS.  Not so much on ex Scottish Life plans)

Could i do better elsewhere?

I have used RL in the last year for people but for me, it fits a certain niche.   I have placed for more elsewhere.   if you are not going to use an IFA, then forget about using RL.  If you are going to use an IFA, then let the IFA tell you who they feel is best after they understand you more.

Albermarle

With Profits funds are seen as somewhat old fashioned and not very good value for money .

If you transfer out to another pension/drawdown provider I would assume most will not offer a with profits fund. Although a few still might , I am not sure .
Something to be aware of though.

P933alilli

Bit late back to this thread, thanks for the help and replies!

 Maybe it best to organise a pensionwise appointment first to get some guidance! I have checked my state pension forecast on the govt gateway and it is £179.60 based on my national insurance record! I assume that is classed as income to be taxed so then i'd only have £3200 or so income (under present rules!) before i start getting taxed. To put a spanner in the works i hastily took quite a large sum out of my cash isa saving and have now lost the tax wrapper.
 
Would the £5000 starter for saving rule plus the £1000 tax free rule still apply given the current rules?

And when looking for an IFA there are numorous comparison sites...Unbiased, VouchedFor etc! Are any particularly better than other? 

AlanP_2

My original pension with RL was set up by an IFA but they have no ongoing involvement.

When I was talking to RL about income drawdown (transfer to a RL scheme with same investments but a different label) there was no mention of needing an IFA involved so worth asking them.

Dazed_and_C0nfused

Would the £5000 starter for saving rule plus the £1000 tax free rule still apply given the current rules

They are still available but the amounts depend on your pension or earnings (pretty much everything taxable that's not interest or dividends).

For example if your pension income is £14,000 then that will reduce the savings starter rate by £1,430 to £3,570.

If your pension income was £20,000 then you wouldn't get any savings starter rate.

Then there is the savings nil rate of £1,000 taxed at 0%.  The £1,000 only gets reduced if you are a higher rate payer.

P933alilli

I contacted RL yesterday and there are no charges or MVR for transferring my with profits to the income release nor will i need an IFA. They would just use their own FA to explain any risks. The funds would be invested in unit trusts of low to medium risk. It would be for another 5-6 years down the track potentially as i want to put my £3600 yearly allowance in to build it up. I also have a pensionwise appointment tomorrow! I'm not sure i could really find anything out from them, however, so it just depends on whether i think my fund would perform better elsewhere and if i use an IFA?