Financial Advisor advice

Lozmaster

Hi everyone. I have, what to me feels like a pretty straightforward idea of what my pensions could provide for me when I retire, probably, next August to coincide with State pension age.
I earn about £30k a year. No mortgage, no credit and a fairly simple lifestyle.
I'm already taking an income from an old db pension of about £7k a year. I'm saving it to pay for a retirement treat of some sort next autumn. After that it will form part of my regular income.
By next August I will have about £120k in 5 separate dc pots, including the one I'm in now.
By my reckoning, a combination of state pension, an annuity, and my db pension could give me a combined income of about £27k. Maybe a p/t job for pocket money. 
Have I oversimplified the set up here? Have I missed anything, and would I really need an IFA for what I think I want?
For background, my wife is 12 years younger than me, earns about the same, and plans to continue working. She has about £85k in savings but no pension provisions to speak of (she didn't trust them).

Dazed_and_C0nfused

Lozmaster said:

Hi everyone. I have, what to me feels like a pretty straightforward idea of what my pensions could provide for me when I retire, probably, next August to coincide with State pension age.
I earn about £30k a year. No mortgage, no credit and a fairly simple lifestyle.
I'm already taking an income from an old db pension of about £7k a year. I'm saving it to pay for a retirement treat of some sort next autumn. After that it will form part of my regular income.
By next August I will have about £120k in 5 separate dc pots, including the one I'm in now.
By my reckoning, a combination of state pension, an annuity, and my db pension could give me a combined income of about £27k. Maybe a p/t job for pocket money. 
Have I oversimplified the set up here? Have I missed anything, and would I really need an IFA for what I think I want?
For background, my wife is 12 years younger than me, earns about the same, and plans to continue working. She has about £85k in savings but no pension provisions to speak of (she didn't trust them).

If you are taking an inflation proofed annuity with joint cover then £7-8k might be a touch optimistic, especially as £120k will become £90k once you take the 25% TFLS.

LHW99

For background, my wife is 12 years younger than me, earns about the same, and plans to continue working. She has about £85k in savings but no pension provisions to speak of (she didn't trust them).

So no "free money" from her employer, no tax refund on pension contributions?

That £85k could have been maybe £120k by now?

Lozmaster

Ok, thanks. 
If felt like I was typing forever, so probably should have added that I'm not planning to take any of the TFLS (I don't see us needing it) and would likely go for a level annuity, to maximise lifestyle while I can in the first 10 or so years of retirement. 

dunstonh

Lozmaster said:

Ok, thanks. 
If felt like I was typing forever, so probably should have added that I'm not planning to take any of the TFLS (I don't see us needing it) and would likely go for a level annuity, to maximise lifestyle while I can in the first 10 or so years of retirement. 

You would take the TFC and not use it in the annuity.

Cobbler_tone

cfw1994 said:

artyboy said:

Marlax said:

I think I'm looking for advice/opinion on how to structure my retirement plan, given what I have, to make sure I'm not unnecessarily paying more tax than I should or to optimise how I use it. All the things they keep saying in the clickbait social media ads about 'dont make these 5 mistakes' or 'you could retire 5 years earlier if you structure your finances like this'. I keep getting emails from MoneyCoachJoe who says he's helped 100s of people 'just like me' to 'cut 10-20 years off their retirement age' and he doesn't want me to miss out (such a caring guy! 😄). Like you I'm cynical about these things especially when they do such obvious hard sell (50% off but only for the next 4hrs!) - but then again, am I missing something optimisation areas?

This is me 100%

Both Mrs Arty and I are perfectly happy with DIY for ongoing investments - we have a reasonable understanding of our risk appetite, and no concerns with DIYing our investments in terms of fund and platform choices.

However as we are approaching retirement, and with a recognition that as things stand, we have a sizeable estate (that has in fact doubled as a result of the pensions IHT changes), what we are looking for is targeted advice on best drawdown, usage, and pass-on strategy.

Everyone is entitled to their own views on the fairness of IHT, but when our own estate's bill has notionally gone up by 7 figures at a stroke, I have no moral qualms about exploring all legal options to optimise our position and that of our children/future grandchildren.

So what we need is an IFA that is able to take a holistic view of our position, and what we are currently planning, and either validate our approach, or give us some expert advice on alternative strategies, e.g.

- use of annuities with long guarantees
- trusts (*shudder* yes, I know, but they can have a use...)
- alternative tax efficient investments within risk tolerance (not sure how diversified you can get with VCTs, as an example)
- investment bonds
- anything else we've not considered.

What we DON'T want is someone that will just manage everything for us for both an upfront and ongoing fee... 

So, got an intro call with a Costco promoted Wealth Management firm - yes I know, I know... but they are - apparently - IFAs, and I feel I need to start somewhere. I'll get a feel pretty quickly if they have anything to offer...

Costco is an interesting choice - often value for money, I would imagine.
Is it https://www.apw-ifa.co.uk/costco ?


<minor thread diversion alert>
Just skimming some of their pages.  Looking at https://apw-ifa.co.uk/wp-content/uploads/2022/10/apw_wtlexplained_a4digital.pdf, I read:

"Assured Private Wealth’s Costco package 1 uses a property protection trust to leave your half of the house to your children but stops them from inheriting it until you have both passed away. This way if your spouse needs care in later life or remarries after you die, then your half of the estate is safe for your children. This type of planning doesn’t change anything in your lifetimes"

Is that needed? 
Would it be possible to change from Joint Tenants to Tenants in Common (equal shares), with your wills sharing your half to offspring on your death?

Just curious if they are looking for more ££ ways to provide something!!


Do report back!

My lived experience is to stay away from Trusts. Unbeknown to the rest of the family my MIL had one when she passed, leaving her dad in the house. She left her assets and half the house to my OH. Not with Costco but someone beginning with 'C'. 9 months later and £8k in it still isn't sorted. They have now got her funds from three banks (6 figures, in fact not much less than half of the house) and had the cheek to ask if my OH wanted an interim payment whilst they wait for the 4th. i.e. leave it in their account as opposed to handing it over. If it wasn't for the devastation of losing her mum she probably would have addressed the financial side herself and I am sure probate could have been sorted months ago....but this Trust seemed to complicate everything and pretty sure it wasn't needed. You could even say that an organisation praying where elderly people meet is underhanded at best. 

RogerPensionGuy

Cobbler_tone said:

cfw1994 said:

artyboy said:

Marlax said:

I think I'm looking for advice/opinion on how to structure my retirement plan, given what I have, to make sure I'm not unnecessarily paying more tax than I should or to optimise how I use it. All the things they keep saying in the clickbait social media ads about 'dont make these 5 mistakes' or 'you could retire 5 years earlier if you structure your finances like this'. I keep getting emails from MoneyCoachJoe who says he's helped 100s of people 'just like me' to 'cut 10-20 years off their retirement age' and he doesn't want me to miss out (such a caring guy! 😄). Like you I'm cynical about these things especially when they do such obvious hard sell (50% off but only for the next 4hrs!) - but then again, am I missing something optimisation areas?

This is me 100%

Both Mrs Arty and I are perfectly happy with DIY for ongoing investments - we have a reasonable understanding of our risk appetite, and no concerns with DIYing our investments in terms of fund and platform choices.

However as we are approaching retirement, and with a recognition that as things stand, we have a sizeable estate (that has in fact doubled as a result of the pensions IHT changes), what we are looking for is targeted advice on best drawdown, usage, and pass-on strategy.

Everyone is entitled to their own views on the fairness of IHT, but when our own estate's bill has notionally gone up by 7 figures at a stroke, I have no moral qualms about exploring all legal options to optimise our position and that of our children/future grandchildren.

So what we need is an IFA that is able to take a holistic view of our position, and what we are currently planning, and either validate our approach, or give us some expert advice on alternative strategies, e.g.

- use of annuities with long guarantees
- trusts (*shudder* yes, I know, but they can have a use...)
- alternative tax efficient investments within risk tolerance (not sure how diversified you can get with VCTs, as an example)
- investment bonds
- anything else we've not considered.

What we DON'T want is someone that will just manage everything for us for both an upfront and ongoing fee... 

So, got an intro call with a Costco promoted Wealth Management firm - yes I know, I know... but they are - apparently - IFAs, and I feel I need to start somewhere. I'll get a feel pretty quickly if they have anything to offer...

Costco is an interesting choice - often value for money, I would imagine.
Is it https://www.apw-ifa.co.uk/costco ?


<minor thread diversion alert>
Just skimming some of their pages.  Looking at https://apw-ifa.co.uk/wp-content/uploads/2022/10/apw_wtlexplained_a4digital.pdf, I read:

"Assured Private Wealth’s Costco package 1 uses a property protection trust to leave your half of the house to your children but stops them from inheriting it until you have both passed away. This way if your spouse needs care in later life or remarries after you die, then your half of the estate is safe for your children. This type of planning doesn’t change anything in your lifetimes"

Is that needed? 
Would it be possible to change from Joint Tenants to Tenants in Common (equal shares), with your wills sharing your half to offspring on your death?

Just curious if they are looking for more ££ ways to provide something!!


Do report back!

My lived experience is to stay away from Trusts. Unbeknown to the rest of the family my MIL had one when she passed, leaving her dad in the house. She left her assets and half the house to my OH. Not with Costco but someone beginning with 'C'. 9 months later and £8k in it still isn't sorted. They have now got her funds from three banks (6 figures, in fact not much less than half of the house) and had the cheek to ask if my OH wanted an interim payment whilst they wait for the 4th. i.e. leave it in their account as opposed to handing it over. If it wasn't for the devastation of losing her mum she probably would have addressed the financial side herself and I am sure probate could have been sorted months ago....but this Trust seemed to complicate everything and pretty sure it wasn't needed. You could even say that an organisation praying where elderly people meet is underhanded at best. 

Did MIL leave house to MILs dad or MILs husband?

Cobbler_tone

RogerPensionGuy said:

Cobbler_tone said:

cfw1994 said:

artyboy said:

Marlax said:

I think I'm looking for advice/opinion on how to structure my retirement plan, given what I have, to make sure I'm not unnecessarily paying more tax than I should or to optimise how I use it. All the things they keep saying in the clickbait social media ads about 'dont make these 5 mistakes' or 'you could retire 5 years earlier if you structure your finances like this'. I keep getting emails from MoneyCoachJoe who says he's helped 100s of people 'just like me' to 'cut 10-20 years off their retirement age' and he doesn't want me to miss out (such a caring guy! 😄). Like you I'm cynical about these things especially when they do such obvious hard sell (50% off but only for the next 4hrs!) - but then again, am I missing something optimisation areas?

This is me 100%

Both Mrs Arty and I are perfectly happy with DIY for ongoing investments - we have a reasonable understanding of our risk appetite, and no concerns with DIYing our investments in terms of fund and platform choices.

However as we are approaching retirement, and with a recognition that as things stand, we have a sizeable estate (that has in fact doubled as a result of the pensions IHT changes), what we are looking for is targeted advice on best drawdown, usage, and pass-on strategy.

Everyone is entitled to their own views on the fairness of IHT, but when our own estate's bill has notionally gone up by 7 figures at a stroke, I have no moral qualms about exploring all legal options to optimise our position and that of our children/future grandchildren.

So what we need is an IFA that is able to take a holistic view of our position, and what we are currently planning, and either validate our approach, or give us some expert advice on alternative strategies, e.g.

- use of annuities with long guarantees
- trusts (*shudder* yes, I know, but they can have a use...)
- alternative tax efficient investments within risk tolerance (not sure how diversified you can get with VCTs, as an example)
- investment bonds
- anything else we've not considered.

What we DON'T want is someone that will just manage everything for us for both an upfront and ongoing fee... 

So, got an intro call with a Costco promoted Wealth Management firm - yes I know, I know... but they are - apparently - IFAs, and I feel I need to start somewhere. I'll get a feel pretty quickly if they have anything to offer...

Costco is an interesting choice - often value for money, I would imagine.
Is it https://www.apw-ifa.co.uk/costco ?


<minor thread diversion alert>
Just skimming some of their pages.  Looking at https://apw-ifa.co.uk/wp-content/uploads/2022/10/apw_wtlexplained_a4digital.pdf, I read:

"Assured Private Wealth’s Costco package 1 uses a property protection trust to leave your half of the house to your children but stops them from inheriting it until you have both passed away. This way if your spouse needs care in later life or remarries after you die, then your half of the estate is safe for your children. This type of planning doesn’t change anything in your lifetimes"

Is that needed? 
Would it be possible to change from Joint Tenants to Tenants in Common (equal shares), with your wills sharing your half to offspring on your death?

Just curious if they are looking for more ££ ways to provide something!!


Do report back!

My lived experience is to stay away from Trusts. Unbeknown to the rest of the family my MIL had one when she passed, leaving her dad in the house. She left her assets and half the house to my OH. Not with Costco but someone beginning with 'C'. 9 months later and £8k in it still isn't sorted. They have now got her funds from three banks (6 figures, in fact not much less than half of the house) and had the cheek to ask if my OH wanted an interim payment whilst they wait for the 4th. i.e. leave it in their account as opposed to handing it over. If it wasn't for the devastation of losing her mum she probably would have addressed the financial side herself and I am sure probate could have been sorted months ago....but this Trust seemed to complicate everything and pretty sure it wasn't needed. You could even say that an organisation praying where elderly people meet is underhanded at best. 

Did MIL leave house to MILs dad or MILs husband?

Sorry, the OH's dad, so her husband. Her half of the house has gone into the Trust. The money has gone to her daughter. My OH and her dad had the conversation and he was adamant he didn't want/need the money his wife left. Ironically my OH doesn't need it either but what her mum wanted. Certainly a situation where the money is a by product of a very sad loss that is admin which needs sorting. My OH is leaving her assets to 6 charities when she passes as has no children.
It wasn't appropriate to question their decision on the Trust in the first place, but don't think it was the wisest move but done with good intentions.

Lozmaster

dunstonh said:

Lozmaster said:

Ok, thanks. 
If felt like I was typing forever, so probably should have added that I'm not planning to take any of the TFLS (I don't see us needing it) and would likely go for a level annuity, to maximise lifestyle while I can in the first 10 or so years of retirement. 

You would take the TFC and not use it in the annuity.

So, why might I do that?

Albermarle

Lozmaster said:

dunstonh said:

Lozmaster said:

Ok, thanks. 
If felt like I was typing forever, so probably should have added that I'm not planning to take any of the TFLS (I don't see us needing it) and would likely go for a level annuity, to maximise lifestyle while I can in the first 10 or so years of retirement. 

You would take the TFC and not use it in the annuity.

So, why might I do that?

The standard annuity takes a pension pot , gives you 25% tax free and uses the 75% to buy the annuity, which produces a regular taxable income
If you want to you can then separately buy a Purchased Life annuity with the tax free cash, but these are not very popular and can only be obtained by going through a financial advisor. However the income they produce is largely tax free.