Abbey Life

Stevenic

My DW has an old unit linked Abbey Life Pension from the late 80's which has been plodding on for many years. We're in the process of sorting out our pension provision and were wondering if we should move her pension and if so, where would you recommend we invest? She is self employed so doesn't have the opportunity to transfer to a company scheme.

Many thanks!

dunstonh

wondering if we should move her pension

Is it better than the alternatives?

and if so, where would you recommend we invest?

38,000 or so investment options and you want us to make a recommendation based on a line of post? It takes a lot more than that i'm afraid.

Stevenic

You've hit the nail on the head - I don't even have the first idea what to do for the best, but I'll give you some idea of her situation. She's 37, has £22,000 in the fund, self employed and not contributing to a pension other than the Contracted Out National Insurance Rebate which is going into the Abbey Life policy. What other information would you like?

dunstonh

She's 37, has £22,000 in the fund, self employed and not contributing to a pension other than the Contracted Out National Insurance Rebate which is going into the Abbey Life policy.

She is self employed so she is not contracted out. She may be contracted out on paper but there is no rebate with self employed as she doesnt qualify for the second state pension.

What other information would you like?

Realistically more than you can post. It would be things like current charges, current funds available, projections to selected retirement age, guaranteed annuity rates (if applicable), attitude to risk, ability and knowledge about investments, type of investing and general opinion on charges and returns.

A lot of old legacy pensions (pre 2001) are quite poor by todays standards. However, a significant minority (if i was to guess a figure, I would put 1 in 5) are still worth keeping. Increasingly so for those taken out before personal pensions came out in 1988.

Stevenic

dunstonh wrote: »

She is self employed so she is not contracted out. She may be contracted out on paper but there is no rebate with self employed as she doesnt qualify for the second state pension.

Thanks for clearing that up, she has only been self employed for a year although does this now mean she pays less NI?

dunstonh wrote: »

Realistically more than you can post. It would be things like current charges, current funds available, projections to selected retirement age, guaranteed annuity rates (if applicable), attitude to risk, ability and knowledge about investments, type of investing and general opinion on charges and returns.

The current projection at retirement age of 65 is £4,770, she's in their Managed Series 3 option, we're looking for something with a medium-high risk for the next 10 to 15 years although we know next to nothing about investing ourselves.

dunstonh wrote: »

A lot of old legacy pensions (pre 2001) are quite poor by todays standards. However, a significant minority (if i was to guess a figure, I would put 1 in 5) are still worth keeping. Increasingly so for those taken out before personal pensions came out in 1988.

Her pension was taken out in 1989 so after that date. Would a Stakeholder Pension be a good choice? My own company pension looks as if it's being transferred into a Fidelity Stakeholder Scheme in April?

dunstonh

Thanks for clearing that up, she has only been self employed for a year although does this now mean she pays less NI?

She pays class 2 and possibly class 4 subject to earnings. Class 2 is the £2 or so a week. So, yes, she pays less NI but then doesnt get the second state pension (and a number of other benefits). The Govt expects the self employed to largely self insure.

we're looking for something with a medium-high risk for the next 10 to 15 years although we know next to nothing about investing ourselves.

You are in medium at the moment. Going medium high involves a bit of knowledge otherwise you are basically going to play hit and hope and that can work or it can go very wrong.

Would a Stakeholder Pension be a good choice?

It could be. It could be the Abbey Life one is fine. Or a personal pension, fund supermarket pension or SIPP. Less likely as you move through that list but then the best medium/high risk options appear with PPPs, Fund supermarket PPs or SIPPs.

Stevenic

Thank again for you help. After some more thought, I like the flexibility of a Stakeholder Pension and there is no way I have enough experience for a SIPP.

I am now wondering which websites could provide comparisons and analysis between different Stakeholder Pension Providers and which offer online management of the pension so that I could make a more informed decision about who to approach as there seems to be a huge choice?