pension or ISA?

madlyn

i have a private pension but i'm not very happy with how it is doing, so.. should i change to another pension fund or close my pension, put the money i recieve into a high rate ISA and countinue putting away what i was paying into my pension? (£30) a month

EdInvestor

madlyn wrote: »

i have a private pension but i'm not very happy with how it is doing, so.. should i change to another pension fund or close my pension, put the money i recieve into a high rate ISA.....

Amazing how many people think they can close a pension and take the money out.They must have been missold.

Reality check: you can't get money out of a pension.The most you can ever extract is 25% at the age of 55.

If you only have one tiddler pension (<17k) you can get all the money out at age 60, after tax of course.

DON'T PUT MONEY IN A PENSION if you think you might want to take it out before you retire.

dunstonh

Amazing how many people think they can close a pension and take the money out.They must have been missold.

Dont be daft.

What is more of concern is that the op thinks they are going to do better with cash over the long run.

Retired_I.F.A.

DON'T PUT MONEY IN A PENSION if you think you might want to take it out before you retire.

Ed knows full well she will never ever under any circumstances want to touch her pension fund before retirement because unlike everyone else in the country her income is guaranteed by a coalition of god the time lords the Asari and the Federation all of whom have traveled in time and know her future.

or is Ed really Biff from back to the future with a sports almanac?

Of course you don't put all you eggs in one basket but to not put any into a pension plan which is the best investment you can possibly make for a retirement the odds of which will last you 20 or so years, because you may need it before retirement is crazy.

thor

dunstonh wrote: »

Dont be daft.

What is more of concern is that the op thinks they are going to do better with cash over the long run.

It does not mean that he won't be right. Cash may have performed worse historically but nobody knows for certain that will be the case for the future. Whenever I invest in stocks and shares I consider it a gamble, no matter how risk averse the investment may be(and that includes cash).

dunstonh

You may be right but the OP doesnt seem to know the differences and that is no way to make a financial decision of this importance. Just a 2% difference in returns a year can double your pension income.

Investments generally zig zag and savings go up in a straight line. Just because you get a bad year in investments when it zags instead of zigs doesnt mean you go into cash for the rest of time.

EdInvestor

We are confusing 2 separate issues here.

1.Is it sensible to invest in shares or cash for the long term

2.Is it better to choose the pension or ISA tax wrapper to put the investment in.

It's quite possible to invest in cash in a pension if you want to, though most people do it only temporarily.Ask the pension provider to switch your money into the cash fund.