70 and wanting pension advise please.

Salsa2006

Hello, I would be really grateful if anyone could give me some advice on the best way to proceed with claiming my pensions. I have been on the pension wise website and completed the questionnaire but am still confused with options.

I have 3 pensions that are with one provider and I with another. My aim is to take the 25% tax free from each and then combine them to buy an annuity. The total value of them all is approximately 100K.

Is this something that I would ask an IFA to set up for me? you hear such horror stories of people being scammed or being given the wrong advice. I haven't anyone I can ask for personal recommendations.

Any pointers on further information and advice would be really appreciated.

Thank you for any advice or suggestions.

Best wishes

itsthelittlethings

You can get a free appointment to talk about your options from Pensionwise. They are a government backed body.

itsthelittlethings

https://www.moneyhelper.org.uk/en/pensions-and-retirement/pension-wise/book-a-free-pension-wise-appointment

El_Torro

It's probably better to combine all your pensions and then take the 25% tax free lump sum, rather than taking the lump sum first.

Many people do use IFAs to buy an annuity. As with pretty much anything you buy it is possible to be scammed, though I wouldn't say it's common. Especially if you do your due diligence. One watch out is that a £100k pension pot (£75k after taking the tax free lump sum) is quite small and the IFA is going to take a relatively big cut of that to set up your annuity. For a pot that small you'll probably find it cheaper to do it yourself.

Albermarle

As above the usual easiest way would be to ;

1. Consolidate all the pensions into one. Probably easier than you think.
2. Shop around for the best annuity, that suits your requirements . You need to think about whether you want it to increase with inflation each year, or not . Whether you want your spouse ( if you have one) to have say 50% of the income if you die before them etc
3. Agree to buy the annuity. The annuity provider will take your pension, give you the 25% tax free and start the income.

DRS1

I was in a similar position to the OP in 2024 when I bought an annuity. I had 5 pensions of which 4 had ended up with Aviva. The other one was with Utmost. That used to be an Equitable Life pension which should tell you I have a track record of poor pension decisions.

I did not consolidate the pensions first. I let that happen as part of the annuity purchase process. The payments came into the annuity provider spread out over a month. And just for amusement the fastest was Utmost (which uses paper instead of the more modern and "speedy" Origo system)

Everyone will tell you to shop around but it is not as easy as it sounds. One simple thing to do (and maybe you have done it already) is to look at some online annuity quote pages. There is one on Moneyhelper here

Compare annuities: get a guaranteed retirement income -

If you are lucky that might tell you the best annuity provider for you is one of your current pension providers. That could make things simpler because you could consolidate your other pensions with that provider and then ask them for a quote. They will deal with you direct if you have your pension with them already.

If the best one is not one of your current pension providers then you will almost certainly need an IFA or an annuity broker. Hargreaves Lansdown do that sort of thing if you are familiar with them. Retirement Line also do it and they are the people I used in 2024 when I found none of the best annuity providers for me would talk to me direct.

If you use a broker they will be paid commission. If you use an IFA they will charge you a fee (and can hopefully get a better annuity rate as it should be commission free). If you are able to go direct don't think that means there is no commission. There is. So going direct is not better than using a broker. Using an IFA (if you can find one) may be better than either going direct or using a broker.

Oh and before you consolidate anything check the terms of your current pensions - some of them come with GARs (guaranteed annuity rates) which can beat those available in the market even now. But you would lose the GAR if you transferred out of that pension.

dunstonh

Is this something that I would ask an IFA to set up for me? you hear such horror stories of people being scammed or being given the wrong advice. I haven't anyone I can ask for personal recommendations.

The scammers are not IFAs. Scammers tended to use unregulated options and play to peoples greed. You use an IFA to avoid being scammed.

Complaint levels for IFAs are tiny and you don't see any sort of volume with annuity complaints.

It's probably better to combine all your pensions and then take the 25% tax free lump sum, rather than taking the lump sum first.

If the OP hasn't taken the tax free cash from the pensions, then the IVPPP method would be used for the annuity purchase which would combine all the pensions into a single annuity payment.

If the 25% tax free cash has been taken, then it's not possible to combine into a single annuity, and with 3 pensions, it would mean 3 payments (although all three could be on the same day)

There is no need to combine them in advance of buying the annuity.

Albermarle

https://forums.moneysavingexpert.com/discussion/comment/81883273#Comment_81883273

OP - Ignore my point 1) - better advice from the previous two posters. However note the advice not to take the 25% tax free before buying an annuity.

Salsa2006

Thank you all so much for responding to my post. The information is really helpful as I seemed to be going round in circles…. I will take everything on board and make some notes and questions before taking any further steps with my pension companies.

Best wishes and thank you again.