25%Lump sum and mutliple pensions

cmb919396

I have four different pension arrangements:
- one relating to a DC scheme from previous employment, now with an insurance company
- a contracted out SERPS pension
- a final salary scheme pension relating to a previous employment
- a DC scheme with my current employer

As I will be 50 next year, and recently deprived of my house through divorce, I am considering taking a lump sum to help build equity towards a new property.

Question is, leaving aside the final salary scheme, can you take 25% of the total value of all the pension pots out of one of the schemes, or do you have to take 25% out of each?

EdInvestor

cmb919396 wrote: »

Question is, leaving aside the final salary scheme, can you take 25% of the total value of all the pension pots out of one of the schemes, or do you have to take 25% out of each?

You won;t be able to take money out of the current one.You can either take the 25% out of each scheme or transfer one into the other and then take 25%.The net effect is the same.

To get the 25% out you need to put the pension into income drawdown.Typically this involves moving it to a SIPP. You'll have to wait until October before you can move protected rights pensions.

Gatser

EdInvestor wrote: »

To get the 25% out you need to put the pension into income drawdown.Typically this involves moving it to a SIPP.

Excuse me Ed, I am tending to agree with you... but even I (as a SIPP fan) do not think that we have to move to a SIPP to commence drawdown. I am advised that this is possible from a Personal Pension.

Do you agree?

whiteflag_3

:mad:

EdInvestor wrote: »

.Typically this involves moving it to a SIPP. You'll have to wait until October before you can move protected rights pensions.

No its doesnt and you dont have to wait until October - simply not true.:mad:

dunstonh

many personal pensions (or transfer plans) can do drawdown and can do protected rights now. They can also do it cheaper or same cost as a SIPP.

There is no need to wait until October. There may be no need to consolidate and you can do partial commencement/drawdown without the need to "crystallise" the whole pension pot or other pensions.

jamesd

cmb919396, yes, you can take 25% of any required proportion of the money, though you may have to transfer the 100% you're taking 25% of to do it. Since investments are likely to grow faster than the cost of the interest rate on a mortgage you're probably going to be best off financially if you take no more than is required to get a mortgage at a reasonable interest rate.

The moving around and taking 25% is routine work for an IFA and if you're not sure about the quality of the investments inside the pensions now's also a good time to get advice on them.

EdInvestor

Gatser wrote: »

Excuse me Ed, I am tending to agree with you... but even I (as a SIPP fan) do not think that we have to move to a SIPP to commence drawdown. I am advised that this is possible from a Personal Pension.

Do you agree?

Typically, funds under 100k will not be accepted for drawdown in a personal pension by the lifecos and most people who come on here asking about drawdown seem to have funds under this level.

One company (Skandia/ Selestia) has been quoted as offering drawdown for smaller funds in a PP but you have to use an IFA (and thus are likely to be charged the usual 3% upfront for processing) and it looks to be more expensive to run than some low cost SIPPs.

I believe it also offers only fund investments - I have not seen a list of which funds - no ITs or shares or gilts.So the lowest- cost investment options are not available and this is a very important issue for successful drawdown IMHO. So the product doesn't look like a money saving option to me.

whiteflag_3

EdInvestor wrote: »

Typically, funds under 100k will not be accepted for drawdown in a personal pension by the lifecos and most people who come on here asking about drawdown seem to have funds under this level.

One company (Skandia/ Selestia) has been quoted as offering drawdown for smaller funds in a PP but you have to use an IFA (and thus are likely to be charged the usual 3% upfront for processing) and it looks to be more expensive to run than some low cost SIPPs.

I believe it also offers only fund investments - I have not seen a list of which funds - no ITs or shares or gilts.So the lowest- cost investment options are not available and this is a very important issue for successful drawdown IMHO. So the product doesn't look like a money saving option to me.

Not true!

Why dont you just admit your wrong for once?

Retired_I.F.A.

Ed Investor admit she's wrong !!!!!!! C'mon Whiteflag get real, you've got more chance of seeing Elvis and the Queen in a !!!!!! movie.

whiteflag_3

Retired_I.F.A. wrote: »

Ed Investor admit she's wrong !!!!!!! C'mon Whiteflag get real, you've got more chance of seeing Elvis and the Queen in a !!!!!! movie.

yes, really stupid of me!

ps

is the said movie still available in vhs format?
:rotfl: