Take 25% tax free lump sum before budget?

GDB2222

I have unit linked pensions with 3 insurance companies. Does it make sense to take the 25% tax free lump sums from these before the budget - just in case? If I do, I'm not sure what to do with the remaining 75%?  I'm between 70 and 75.

I'm not very interested in managing the investments, but I'm not sure I want an annuity.

One of the insurers is Standard Life, does anyone know whether they offer a reasonable drawdown product?  I'd prefer to get it all in one place - just to make life easier - and I think Standard Life makes reasonable sense. 

Can I draw the 25% from the other companies, and then transfer the remaining 75% to Standard Life, or do I have to do the transfer before taking the lump sum?

Thanks. It's a while since I had to think about this sort of thing.

MeteredOut

What are you planning to do with the money?

If the only reason you're considering this is because of the media click-bait rumours, don't do it.

Personally, I think there is a 0% chance of the 25% TFC being removed, and close to that for the £268K+ limit being reduced.

Albermarle

GDB2222 said:

I have unit linked pensions with 3 insurance companies. Does it make sense to take the 25% tax free lump sums from these before the budget - just in case? If I do, I'm not sure what to do with the remaining 75%?  I'm between 70 and 75.

I'm not very interested in managing the investments, but I'm not sure I want an annuity.

One of the insurers is Standard Life, does anyone know whether they offer a reasonable drawdown product?  I'd prefer to get it all in one place - just to make life easier - and I think Standard Life makes reasonable sense. 

Can I draw the 25% from the other companies, and then transfer the remaining 75% to Standard Life, or do I have to do the transfer before taking the lump sum?

Thanks. It's a while since I had to think about this sort of thing.

I would not do it due to speculation about the budget.
However it is normally recommended to get the 25% tax free out before age 75.
The reason is that if you die after 75 and the pot is passed onto a beneficiary ( presumably), they can not take any tax free cash out that has previously not been taken.

Standard Life have a normal drawdown facility, so should be OK, if not the cheapest. Website and customer service are good.
Normally it is much easier to transfer a pension pot before taking the 25% tax free.
Sometimes it may not even be possible to transfer the crystallised 75%.
You may find that even if you stay with SL, you will have to transfer to one of their more modern pension schemes before starting drawdown.

Cobbler_tone

I have never read that it is advisable to do anything in relation to financial matters before anything else is announced as fact. Certainly not with the raft of speculation across multiple outlets. I'd be interested to know the stats on the number of people who haven't filled ISA's in this tax year (that could), thinking the allowance was going to be slashed.

The only certainty (which isn't actually a certainty but I will wager £1 with anyone) is that taxes are going to rise in more than one area during the next budget. Whether that impacts on some or all of the population will probably come down to circumstance and a bit of luck. Nostradamus could have a stab at what to do with your personal situation...but could well leave you worse off.
I think there has been enough news, coverage and government noise to know it is going to be grim. The government noise being a tactic to evoke "Oh, that wasn't too bad for me" although some people will no doubt be negatively impacted.
Hold your nerve, although not a bad time of life to consider the best way of withdrawing it if that's your plan.

dunstonh

Does it make sense to take the 25% tax free lump sums from these before the budget - just in case?

Every budget since 1988 has seen the media speculate the the 25% TFC is being removed.

One of the insurers is Standard Life, does anyone know whether they offer a reasonable drawdown product?  I'd prefer to get it all in one place - just to make life easier - and I think Standard Life makes reasonable sense. 

The modern Standard Life is not the same company as the original Standard Life.   The modern one is Phoenix trading as Standard  Life.    The old Standard Life, now called Aberdeen, has better pension products.

artyboy

dunstonh said:

Does it make sense to take the 25% tax free lump sums from these before the budget - just in case?

Every budget since 1988 has seen the media speculate the the 25% TFC is being removed.

One of the insurers is Standard Life, does anyone know whether they offer a reasonable drawdown product?  I'd prefer to get it all in one place - just to make life easier - and I think Standard Life makes reasonable sense. 

The modern Standard Life is not the same company as the original Standard Life.   The modern one is Phoenix trading as Standard  Life.    The old Standard Life, now called Aberdeen, has better pension products.

Yes but this time they might be right... 

Not unlike certain cults that predict the end of the world on a regular basis. Sooner or later they'll be able to say "told you so". Or rather, they won't...

MeteredOut

Lowtrawler said:

westv said:

Urgent! !!!
Best to take it out tomorrow morning! Rumours of a mini budget on Friday where the 25% will be gone by the weekend!!!!

Hopefully most regular visitors here will recognise this as a sarcastic and humorous comment. However, I fear there are a great many people who might think the comment is serious and go into panic mode.

I'm not so sure it was meant to be humorous. That sort of sentence is the exact sentiment that can be found across social media platforms. If it was meant as a joke, it's a dangerous one, as we've seen on these boards this year how people will and do believe what they read online, often with negative financial impact.

DRS1

The age 75 point made up above is a good one and that alone could justify taking the 25% TFLS.

If the speculation turns out to be rubbish would that make any difference to you?  Would you be one of those people who want to put the TFLS back into their pension?  Maybe check if you could do that - consolidating the pensions all with SL might not help with that but they may all say that once you have taken the money that is it and you can't unravel it.

Cobbler_tone

The people considering this are probably in the same queue as the people rushing to sell their £500k+ homes due to mansion tax. Not that the average £500k+ home is actually selling around my way. I live slap bang in the middle of the country, which is a building hotspot. The growth of smaller homes (2 and 3 bed) is really noticeable and the 4 bed+ are either few and far between, or according to the site manager I spoke to, the last to sell.
It is going to be an interesting couple of years.

GDB2222

dunstonh said:

Does it make sense to take the 25% tax free lump sums from these before the budget - just in case?

Every budget since 1988 has seen the media speculate the the 25% TFC is being removed.

One of the insurers is Standard Life, does anyone know whether they offer a reasonable drawdown product?  I'd prefer to get it all in one place - just to make life easier - and I think Standard Life makes reasonable sense. 

The modern Standard Life is not the same company as the original Standard Life.   The modern one is Phoenix trading as Standard  Life.    The old Standard Life, now called Aberdeen, has better pension products.

So, if I took my pensions out 25 years ago, am I with Phoenix, or Aberdeen? 

The 3 companies were Clerical Medical, Scottish Mutual, and Standard Life. Have they all ended up with Phoenix, then?

Just remembered I also have a small Sun Life policy. It's definitely time to consolidate it all into one place, before my mind goes entirely!

 

dunstonh

So, if I took my pensions out 25 years ago, am I with Phoenix, or Aberdeen? 

Standard Life Aberdeen sold the legacy book to Phoenix along with the Standard Life brand name.   It retained the more modern platforms and fund house and rebranded as just Aberdeen (or Abrdn for a short period).

The 3 companies were Clerical Medical, Scottish Mutual, and Standard Life. Have they all ended up with Phoenix, then?

Clerical Medical and SW are owned by Lloyds.  CM is a closed book and is run by SW now.  Sometimes you see letters on CM policies using SW paperwork. Sometimes back to CM paperwork at other times.