Contract In/Out Advice Please....

masonsmum01

My husband is driving me crazy with his pension at the moment, he has spent ages looking for information and advice on contracting in/out of S2P and never seems to come up with an answer.

He is 31 years old and has had a company pension for 3 years and has been told it is a contracted in pension. Around 11 years ago, before he had his pension he took out a small insurance policy with Brittanic and they contracted him out. This contracted out pension has made him around 7 or 8K over that period.

Recently Brittanic (now called Phoenix) wrote to him to advise him in 2008 they would be contracting him back in to S2P unless he states he wants to stay out as he will make more money back in during 2008.

Only problem is he likes the sound of the contracted out scheme better and thinks the 2SP lum sum when retiring is a better option.

Is there huge amounts of difference in what contracting back in can make or is contracting out still a good option for him. Any advice from someone in the know would be greatly appreciated.

dunstonh

Is there huge amounts of difference in what contracting back in can make or is contracting out still a good option for him.

He is young enough to be contracted out. The pivotal age for men is 45. If he earns enough then it can still be worth it.

However, not with the rubbish pension he has at the moment. They are contracting him back in not because contracting out is the wrong thing but because their pension is useless and they know using that pension is not good enough and want to protect themselves from future potential complaints.

masonsmum01

Hi thanks for your reply but could you give me any advice on what other routes you would recommend.
Thanks

EdInvestor

Transfer the pension to a provider with low charges and a good choice of external funds, such as Scottish Widows, L&G, Norwich Union, Standard life.

If you go via https://www.cavendishonline.co.uk they will rebate the charges, don't go direct to the provider..