Best provider for inherited pension

topyam

Am able to transfer my late husband's pension (approx £110k)

Options given to me by the current provider are 

1. Take all as cash

2. Buy a guaranteed income

3. Transfer to another provider

4. Take a flexible income

As he was under 75, I receive it tax free. I am 44.

Provider is L&G atm. No idea what the current fees are. 

Looking for the best option financially to make the most out of this money. And 1 and 2 don't appeal really.

Wondering whether to just transfer this inherited pension to another provider.  Are some providers better than others for this? Considering fees and ongoing costs too.

Sam_666

Is this DC or DB pension? 
If you dont know what L&G fees are, how are you going to compare it with other proviers fee?
I wonder if transfering this kind of pension will impact its tax free status.

dunstonh

Looking for the best option financially to make the most out of this money

Which best fits your objectives and circumstances?  (none of which you have mentioned)

Wondering whether to just transfer this inherited pension to another provider.  

On what basis?  (there may be good reason but you would be looking at justification for doing so)

 Are some providers better than others for this? 

Yes.  However, it depends on what you are after.  One person's "better" may not be important to another person.

I wonder if transfering this kind of pension will impact its tax free status.

it doesn't.    It has its own classification.    However, not all plans will support beneficiary drawdown.

Albermarle

I would probably consider L&G as an older style pension provider, so you might better off with a more modern provider. ( others may have a different opinion).
Have you had a look/used their website ?
You can have a look around other providers websites without being a registered customer and see what you think.
Have a look at ;
Hargreaves Lansdown
Fidelity personal investing
AJ Bell
Standard Life 
+ others 

SVaz

Will you need the money for income before you retire?
I’m assuming, because you haven’t mentioned needing the cash now, that you don’t.
If it was my Wife,  she would transfer the pension into a modern Sipp to use as and when or draw £20k a year and put it into a Stocks and Shares ISA.  It’s sort of hedging your bets against future tax changes. £20k now + £20k in April. 
I wouldn’t put it past the Govt changing the pre/post 75 taxation,  whether they would ( or could)  change it retrospectively is anyone’s guess. 

topyam

All new to this really

Have ruled out the lump sum as I figure if I need the cash, it's available to drawdown and that keeps the tax free element.

Ruled out an annuity as I am young and it does not seem good value for money

So between the other two. Know nothing about the current pension as it wasn't mine. 

Looked at maybe moving provider but not sure which are best for inherited pension.

Would like the option to take money out in future if i needed to, but don't need in immediate future.

I have a current sipp with aj bell. V small amount in it. I don't work. Have kids under 18. Current isa (cash) is maxed out. Would hope to fill a s&s isa next year.

SVaz

Ahh, if you don’t work that changes everything as money in a Sipp isn’t counted as an asset where benefits are concerned until State pension age. 

Even if you don’t need benefits now because you got a decent Life insurance payout,  there’s no saying you won’t need them in future. 

Also with you saying your own pension is small,  you can still pay in £2880 and get tax relief to make it £3600 per year.  

I would keep the inherited pension and your own Sipp separate just for clarity.  

RogerPensionGuy

topyam said:

Am able to transfer my late husband's pension (approx £110k)

Options given to me by the current provider are 

1. Take all as cash

2. Buy a guaranteed income

3. Transfer to another provider

4. Take a flexible income

As he was under 75, I receive it tax free. I am 44.

Provider is L&G atm. No idea what the current fees are. 

Looking for the best option financially to make the most out of this money. And 1 and 2 don't appeal really.

Wondering whether to just transfer this inherited pension to another provider.  Are some providers better than others for this? Considering fees and ongoing costs too.

Sorry to hear your husband died. 

I'm far from an informed person as my postings show easily.

My pick up is at 44 with children under 18 you may do well taking a holistic or helicopter view going forward.

The pension of 110K is certainly helpful and decide slowly is my feeling and needs to be used most effectively, there is a two year rule included in the link below that maybe interesting. 

Reference longer term, did I read generally a balanced investment doubles every 8 or 9 years historically, so top of my head if that 110K could be placed in a sensible vehicle to grow could be a good result. 

Another top of the head, if that 110K could be taken fully tax free and possibly fed in to S&S ISAs over a few years(obviously ISAs could have limits applied on them in the future) this could result in very heavy ISAs down the road. 

Another top of the head, with children under 18, does taking any income or cash affect any help support you may be getting now or on the future. 

I'm sure others will post good information on this thread, I also put another link on the bottom of this post, it maybe helpful. 

I hope all goes well for you and the family, best wishes Roger. 

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Tax on a private pension you inherit - GOV.UK https://share.google/IEQZnbPQgrKq7GcoK

***

Benefits and financial support when someone dies - GOV.UK https://share.google/4nxtvpWMJJHsibzsC

Marcon

There's more background in a previous thread from OP, to save her having to repeat information in this thread: https://forums.moneysavingexpert.com/discussion/6615198/late-husbands-pension/p1

OP, I hope you are as OK as you can be in the circumstances. Losing your husband so recently and so young, especially when you have four school age children, is awful for you all. Doubtless people will bear that in mind when responding to you.

topyam

Ah hasn't been easy.

Taking tax free wouldn't affect any benefits.

I guess I'm looking a sensible place to put it to grow. And the option I think to access (not immediately anyways but maybe before retirement) 

I have maxed out my own sipp and isa this year. 

I would plan to max out both maybe next year - defo the s&s isa.

Thanks folks. Will have a read of everything.

DRS1

This Which article may be about the wrong type of drawdown but I thought you might like to see it

Best pension drawdown providers 2025 - Which?

If I were you I would be tempted to move the pension to AJBell.  You already have a SIPP with them so presumably you like their service (fees web pages and so on).  They also seem to be well rated by Which.

My only thought on that was whether having two SIPPS at the same place could cause confusion (for you or them) eg contributions going into the wrong one or payments out of the beneficiary drawdown SIPP being taxed by mistake (someone thinking they came from your personal SIPP).

You might want to ask AJBell how they designate a Beneficiary Drawdown SIPP to see how easy it would be to get confused.

Also maybe check if you would benefit on fees from having more assets/accounts with AJBell.