Old Co-op pension

Lily8

Hi everyone, my OH has an old Co-op pension which moved to Royal London. The specified age is 65 which is this year. He has the quote, the pot is 21K and the options available. We weren't sure which option to take but don't need to draw it at present. Just wondered what your opinions would be regarding leaving it where it is for now? I have read about pots dropping but looking back at the annual statements can't see this has happened. Unless I'm looking in the wrong place of course

Brie

Sounds like this might be a direct contribution (DC) pension which can be drawn down in intervals assuming Royal London have that facility.  Otherwise it might need to be moved to another pension administrator so you get the sort of service you need, when you need it.  

I've got 2 DC pensions I was looking to move last year but one had dropped dramatically and the other larger one was a bit daunting for me to deal with during a difficult period of my life.  And I wasn't desperate for the cash so left them where they were as they affectively cost me nothing where they are now (still under the employers' umbrella).  I'm just at the start of looking at them again to see if it's worthwhile but i may decide to leave them for another couple of years.  There are obviously tax implications of when you take the money beyond any 25% lump sum you might take so best to look into that side so you know what you need to do when.  

QrizB

Lily8 said:

We weren't sure which option to take but don't need to draw it at present. Just wondered what your opinions would be regarding leaving it where it is for now?

It's hard to suggest anything in isolation.

When does your OH ntended to retire, what plans do they have for providing income during their retirement and how does this pension fit into those plans?

Lily8

Thanks Brie, yes it is a DC pension. Sorry to hear you've had a difficult time. I hope that pension recovers well for you in the long term.

Lily8

QrizB said:

Lily8 said:

We weren't sure which option to take but don't need to draw it at present. Just wondered what your opinions would be regarding leaving it where it is for now?

It's hard to suggest anything in isolation.

When does your OH ntended to retire, what plans do they have for providing income during their retirement and how does this pension fit into those plans?

Sorry QrizB, realise I  haven't given enough information. OH retired at 60, earlier than we thought but has a DB pension as income. I took partial retirement from the CS last year at 60. Potentially retiring fully next year when OH receives state pension. OH current net monthly £1511.42. My net £1479.24 ( of which £552.82 is my pension). We have savings and no debts and are managing on the income we have. So this pension is a bonus really. We have checked our state pension forecasts and both show entitlement to the full new state pension if we reach that age.

QrizB

If OH is currently in recept of about £20k pa gross, this pot which could be worth £1k pa isn't a huge factor either way.

OH doesn't have any spare personal allowance so the taxable part will be taxed no matter how many years it's spread over. And taking it all at once won't incur higher rate income tax.

I don't see any real drawbacks from taking it all now. Whether it's then spent or invested is OHs choice.

dunstonh

 The specified age is 65 which is this year. 

That is only if he wants to take it.  The age is a guide.  its not a rule.  It can be changed.

We weren't sure which option to take but don't need to draw it at present. 

So, dont then.