Pension Help

EdInvestor

Retired_I.F.A. wrote: »

Probably Kermit told him at the same time as he told you both that one should never transfer from a final salary scheme.

Now that you've been brought up to date on the realities in this area, perhaps you'd like to withdraw this and other jibes based on out of date information, Retired IFA.

Retired_I.F.A.

Ah c'mon Ed the bigbloke saw the funny side wassup got no sense of humor?

Fact remains nothing has changed as to what's allowed and there's nothing wrong in transferring from a final salary scheme, or doing a pension linked mortgage the only thing that has changed is the regulators have sided with bogus claimants so much more since I got out the game that the advisers and the insurance companies today are running scared of such business.

Maybe I ought to get back into it, find a client with a preserved pension transfer it as I have done in the past and set the client up with a pension linked mortgage. Wait for him to claim, see the compensation order, tell the regulators in charge to kiss my !!!! and fight them all the way to the European courts. I have the balls to do it but not the finances unfortunately.

Remember the maximum commission agreement? Office of fair trade or whatever they were called got that kicked into touch maybe they ought to step in here too as it seems to me Joe public today who wants to buy a legally sold product has to first overcome the picket fence of regulators holding a shotgun to the IFA's head.

I Always said the P.I.A. were Pillocks In Authority pity this board censors what I call their latest title now. I'll let you guess.

Dithering_Dad

dunstonh wrote: »

money in a pension is for retirement. Hence why its called pension and not savings acount.

This is exactly the reason people (including me) should save for retirement using a traditional pension product rather than an ISA. It's too easy to dip into savings for other things such as house/car/shoe purchases or even financial emergencies. It's also too easy for the government to make us dip into if we ever find ourselves unemployed and means tested for benefits.

For certain people who advocate ISAs to the exclusion of pensions, please remember.. Not all of us are in the comfortable position of having husbands to support us when we're not working

EdInvestor

Dithering_Dad wrote: »

This is exactly the reason people (including me) should save for retirement using a traditional pension product rather than an ISA. It's too easy to dip into savings for other things such as house/car/shoe purchases or even financial emergencies.

If you have no self discipline this may be so.

. It's also too easy for the government to make us dip into if we ever find ourselves unemployed and means tested for benefits.

But it's also easy for the Government to change the rules on pensions and because your money is trapped inside them, you cannot move it of you disapprove of the change.

For certain people who advocate ISAs to the exclusion of pensions, please remember.. Not all of us are in the comfortable position of having husbands to support us when we're not working

Eh?

Dithering_Dad

EdInvestor wrote: »

If you have no self discipline this may be so.

How many times do we see people on this board asking "How do I cash in my pension, I want to buy a house/car/overseas holiday home". Also, the temptation to use a pension to fund a short-term financial problem like redundancy must be immense.

EdInvestor wrote: »

But it's also easy for the Government to change the rules on pensions and because your money is trapped inside them, you cannot move it of you disapprove of the change..

The government could just as easily change the rules on ISAs and say that they are doing away with them, and that a maximum of £20k only can be retained in them - all others must be closed. I seriously doubt that the government would ever means test pensions because, by their very nature, you cannot get at the money to fund your unemployment so how can they be means-tested?

EdInvestor wrote: »

Eh?

Just remarking that some people offer advice, while wrapped in their VERY comfortable high earner husband safety blanket, which may not be valid for the majority of posters. Naming no names.

kingkano

Dithering_Dad wrote: »

This is exactly the reason people (including me) should save for retirement using a traditional pension product rather than an ISA. It's too easy to dip into savings for other things such as house/car/shoe purchases or even financial emergencies. It's also too easy for the government to make us dip into if we ever find ourselves unemployed and means tested for benefits.

For certain people who advocate ISAs to the exclusion of pensions, please remember.. Not all of us are in the comfortable position of having husbands to support us when we're not working

I agree with Ed. They just keep changing the rules, and meanwhile the money is stuck there. I am 30 and started my pension 5yrs ago. Since then they've decided I can't get the government pension until I am 68. Wish I contracted out my SRP now!

Then they are changing the age to get your lump sum/private pension to 55. This year they change the tax break I get on contributions.

I still have another 30 years theoretically. I shudder to think what rules will be by then, or between now and then what changes they will make (baby boomers retire soon dont they). probably I wont be able to get anything till I'm 80!! (or maybe even nothing at all) Life expectancy isn't really that high in my family so it starts making a pension look like a stupid idea if I can't get the money WHEN I WANT TO RETIRE. The whole point of it surely?

dunstonh

Since then they've decided I can't get the government pension until I am 68. Wish I contracted out my SRP now!

You still can.

Then they are changing the age to get your lump sum/private pension to 55. This year they change the tax break I get on contributions.

The change to 55 isnt a problem. The average retirement age is 62 and likely to increase not reduce. This is partly linked to pension unlocking and people using their pensions early for other means.

The change in tax relief in basic rate is not an issue either as it is cancelled out by what you take home in your pay.

I still have another 30 years theoretically. I shudder to think what rules will be by then,

It is one of the negatives of a pension. That cannot be denied.

However, as DD says, ISAs have negatives too. From an income only point of view, the pension will provide the highest income. Death benefits prior to retirement are higher. The ability to spend the money in the ISA and not the pension can be a curse to some and a benefit to others.

jamesd

Dithering_Dad wrote: »

I seriously doubt that the government would ever means test pensions because, by their very nature, you cannot get at the money to fund your unemployment so how can they be means-tested?

Think again. Once over the age that they can take the pension (50, soon 55 for a personal pension) people have had the potential pension income included in the means test. Effectively forcing them to start taking the pension even though it's contrary to their long term interests.

Dithering_Dad

jamesd wrote: »

Think again. Once over the age that they can take the pension (50, soon 55 for a personal pension) people have had the potential pension income included in the means test. Effectively forcing them to start taking the pension even though it's contrary to their long term interests.

I did a google search for this, expecting a wave of outrage on this issue but could not find anything (at all) on the government's new policy of forcing UK citizens to take early retirement due to unemployment.

I had a good poke about on various government sites and the only thing I could find referred to pensions affecting means testing is when you are already in receipt of retirement income.

Could you please provide any links to this (the mass enforcement of retirement of 55 YR old UK unemployed citizenry?)

exil

On the contrary, a pension fund is explicitly excluded from means testing calculations - whereas an ISA or other savings pot is treated as "capital".

If you have a frozen pension in an employer's scheme it can be impossible to force the scheme to start paying out early anyway, other than by transferring the value to a private pension at a considerable loss, so it seems extremely unlikely that the govt would ever go down this road.

On the other hand - if you jack it in (as seems very tempting to beat the 2010 deadline) and live on your savings, you will get zilch from the govt until you drop below the savings limit. But then why should the state subsidise me because I no longer feel like working on reaching 50?