Pension decision time

Luckyspal

I am 74 years old and have a pension of about £600k in managed funds, split between Clerical Medical and Aviva.  I realise that I have to take action this tax year or I will lose tax free benefits.  I lean towards a drawdown only SIPPS, invested in passive funds of bonds and equities on a low costs platform.   Vanguard and AJ Bell look good to me but I would appreciate any comments from forum members.

Many thanks

Le_Kirk

Maybe you need to post in a pensions or other similar sub-forum rather then in site feedback; I'll see if I can find a suitable category, maybe this one: -
Pensions, annuities & retirement planning and I see you have posted in their a few times already!

MSE_ForumTeam5

We've moved this to the Pensions board.

(If you see a thread in the wrong place, please alert us using the report button and choose the 'needs moving, merging or splitting' option.)

dunstonh

 Vanguard and AJ Bell look good to me but I would appreciate any comments from forum members.

Vanguard is marketed as a SIPP but it doesn't have full SIPP functionality.  It is more comparable to being a personal pension (Vanguard themselves call if the Vanguard personal pension but then sometimes drop in rhe SIPP name in their marketing).

Vanguard pricing on their platform is good but it does limit you to Vanguard funds, which is not so good as they don't have the best trackers in every area (either by cost or by tracking).

AJ Bell is a real SIPP and not one just called that by their marketing team.   It is whole of market, allowing you to pick the best trackers on the market

Albermarle

Hargreaves Lansdown are the biggest player in the retail  SIPP market.
They have a good reputation for customer service etc, but their platform charge is a bit on the higher side.
However they are currently offering generous cashback for transferring pensions into them ( £1500 for a big fund like yours) OF course this should not be the deciding factor but worth knowing.
Transfer to HL for more choice, clarity and control. Plus get cashback. Terms apply.

An obvious question is why move the pensions in the first place . Presumably you can take the tax free cash from them now ?

Pat38493

Luckyspal said:

I am 74 years old and have a pension of about £600k in managed funds, split between Clerical Medical and Aviva.  I realise that I have to take action this tax year or I will lose tax free benefits.  I lean towards a drawdown only SIPPS, invested in passive funds of bonds and equities on a low costs platform.   Vanguard and AJ Bell look good to me but I would appreciate any comments from forum members.

Many thanks

I am not sure what you mean by "lost tax free benefits" if you don't "take action" this year, but a quick search showed that maybe in the past it was mandatory to take your tax free cash before you reach 75.  However that doesn't seem to be the case anymore, so if you are thinking that is the case it is no longer true.

I am not sure if the company that your fund is with, could have that as a rule of the pension itself that you must take the tax free cash by age 75 (if they did I would wonder if that was age discrimination and could be legally challenged) but it seems that there is no legal issue anymore.

Marcon

Pat38493 said:

Luckyspal said:

I am 74 years old and have a pension of about £600k in managed funds, split between Clerical Medical and Aviva.  I realise that I have to take action this tax year or I will lose tax free benefits.  I lean towards a drawdown only SIPPS, invested in passive funds of bonds and equities on a low costs platform.   Vanguard and AJ Bell look good to me but I would appreciate any comments from forum members.

Many thanks

I am not sure what you mean by "lost tax free benefits" if you don't "take action" this year, but a quick search showed that maybe in the past it was mandatory to take your tax free cash before you reach 75.  However that doesn't seem to be the case anymore, so if you are thinking that is the case it is no longer true.

I am not sure if the company that your fund is with, could have that as a rule of the pension itself that you must take the tax free cash by age 75 (if they did I would wonder if that was age discrimination and could be legally challenged) but it seems that there is no legal issue anymore.

...or possibly OP is thinking about making further contributions, which would need to be done before reaching age 75 to qualify for tax relief on the contributions (which would be limited to £3,600 gross if they have no relevant earnings).