Do I need an advisor to drawdown my tax free cash?

Alicante6

I want to drawdown my tax free allowance. My financial advisor has quoted a high fee for handling this so I'm looking to do it myself. What should I be aware of or is it better to pay my advisor and leave it to her?

HappyHarry

Do you already pay her an ongoing fee each year?

Mark_d

You have various options as to how you can use your pension savings.  You can take all the tax free cash now, or you can benefit from an extra tax free allowance every year as you draw down you pension.

What would you do with your 25% tax free cash?  Would it sit in a cash savings account, where you'd pay tax on the 5% interest your earn?  Would you use the cash to pay off a mortgage or buy  a property which you couldn't buy without using the funds from your pension?

Alicante6

Yes I pay 0.75% on my portfolio. I want to access my tax free money from a separate fund that is not included in this portfolio

Alicante6

Thanks. I would use it for home improvements. 

Mark_d

It sounds like you know what you're doing.  If you pension fund is huge you might want advice because a small change in your plans could save you thousands...but see if you can get a better deal on the financial advice.

If your funds are more modest then you might be better off saving the cost of financial advice.

Alicante6

Thanks for your thoughts

Marcon

Mark_d said:

It sounds like you know what you're doing. 

Not sure it does.  There's a significant difference between 'tax free cash' and 'tax free all9wance' and there's no evidence OP is completely clear - OP, are you?!

dunstonh

Alicante6 said:

Yes I pay 0.75% on my portfolio. I want to access my tax free money from a separate fund that is not included in this portfolio

Most advisers do not charge any "initial" fees for top ups or work carried out if you are paying an ongoing charge.   That is largely the whole point of paying ongoing charges.     However, I can see why there would be a charge in this case as the existing fund is separate.     Its a lot of work for an adviser and a potentially high risk case (accessing your pension whilst you are not retired is not considered a good thing unless you have lots of money).

What should I be aware of or is it better to pay my advisor and leave it to her?

Why is this fund separate from the adviser?      
Is it an active workplace scheme or does it have safeguarded benefits?  (just wondering why the adviser never brought it under their control - if there were safeguarded benefits, that would make sense but it would change the scenario if that is the case).

What are you referring to as tax free allowance?   Is that the personal allowance or the 25%?

What is the impact of taking this money on your retirement? (I recently had someone want to take their 25% for home improvements against my advice, and it was out of the blue and unexpected and has made their retirement plans unaffordable)

Alicante6

That's really helpful, thank you. 
The fund was separate because it was a company pension. Its returned 10% in the last year. I was planning to take my 25%  personal tax allowance from it. I've read that Labour my scrap this benefit. I've decided not the make the withdrawel for the moment and look at handing the fund over to my advisor to see if he can switch it to a better performing fund. It's £150k and the advice fee is over £2k for doing this. Is this inline with market rates? 

Dazed_and_C0nfused

Alicante6 said:

That's really helpful, thank you. 
The fund was separate because it was a company pension. Its returned 10% in the last year. I was planning to take my 25%  personal tax allowance from it. I've read that Labour my scrap this benefit. I've decided not the make the withdrawel for the moment and look at handing the fund over to my advisor to see if he can switch it to a better performing fund. It's £150k and the advice fee is over £2k for doing this. Is this inline with market rates? 

You seem to be conflating two completely different things.

As such I'm not sure how Labour (or any other party) could scrap something that doesn't yet exist!