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  • FIRST POST
    • smashem
    • By smashem 15th Jul 18, 1:28 PM
    • 8Posts
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    smashem
    Pension options
    • #1
    • 15th Jul 18, 1:28 PM
    Pension options 15th Jul 18 at 1:28 PM
    Hi all,
    Your opinions please.
    I am 58 & have 2 Pensionís. The first one is from a company I was made redundant 18yrs ago. The 2nd is with my current employer & this pension is run by Aviva.
    The company running my 1st Pension have offered me an uplift to my pot, if I wish to transfer out. The fund value was £129,000 but with the uplift it will be worth £149 000 if I transfer it.
    If I took my 1st Pension now, I would receive £4312 a yr or if I took 25% tax free it would be £3343 per yr & would increase every year by the rpi. My 2nd Pension pot is currently £41000.
    My question is should I transfer my 1st Pension pot to my 2nd Pension pot? If I did this could I retire then rather than take an annuity, just draw off an amount that stops me from paying any income tax(keeping under my tax code) I would also be able to draw another 25% free of tax too. The idea is to run the fund off over the years, but keep it invested with Aviva so it can still make money.
    When my state pension clicks in at 66-67yrs I would reduce what I draw out of my Pension pot ensuring it would give me an income just short of paying tax until Iím 90yrs+
    My questions are, Is thereís any implications with this? Do I have to take an annuity at 75? Am I making a big mistake doing this? I have several ISA investments & no real dependants.
    I thank you in advance for your replies
Page 1
    • LHW99
    • By LHW99 15th Jul 18, 1:54 PM
    • 1,478 Posts
    • 1,356 Thanks
    LHW99
    • #2
    • 15th Jul 18, 1:54 PM
    • #2
    • 15th Jul 18, 1:54 PM
    So they are offering a £20,000 increase in value for giving up £3k - 4k for the rest of your life - possibly another 30 years (or more)? (would it also be index linked in some way?)

    Doesn't seem good value to me, but what do I know?
    • smashem
    • By smashem 15th Jul 18, 3:26 PM
    • 8 Posts
    • 0 Thanks
    smashem
    • #3
    • 15th Jul 18, 3:26 PM
    • #3
    • 15th Jul 18, 3:26 PM
    Well if itís with Aviva my pot will grow at whatever rate they manage to make while investing it, because I wonít be buying an Annuity. I will be just shrinking the capital each month/year. Well thatís the plan
    • greenglide
    • By greenglide 15th Jul 18, 6:04 PM
    • 3,178 Posts
    • 2,064 Thanks
    greenglide
    • #4
    • 15th Jul 18, 6:04 PM
    • #4
    • 15th Jul 18, 6:04 PM
    Your first pension is a Defined Benefit scheme and to transfer it out you would need to seek the advice of a suitably qualified Financial Advice who has authorisation for pension transfers. Do don't have to take the advice.


    Why are you in such a rush to ditch the £4342 indexed linked pension? The normal reason people use is to leave more to dependents but you say you have none.


    This is not an annuity.
    • FatherAbraham
    • By FatherAbraham 9th Aug 18, 6:42 AM
    • 898 Posts
    • 665 Thanks
    FatherAbraham
    • #5
    • 9th Aug 18, 6:42 AM
    • #5
    • 9th Aug 18, 6:42 AM
    Well if itís with Aviva my pot will grow at whatever rate they manage to make while investing it, because I wonít be buying an Annuity. I will be just shrinking the capital each month/year. Well thatís the plan
    Originally posted by smashem
    What's your problem with buying an annuity? You seem to have ruled it out without having any figures.

    Your drawdown plan sounds like you want to exhaust your retirement savings ("shrinking the capital"). Have I misunderstood? Many drawdown strategies are aimed at preserving the capital for as long as possible so it can keep providing an income in old age.

    What are you trying to achieve?
    • dunstonh
    • By dunstonh 9th Aug 18, 10:36 AM
    • 95,334 Posts
    • 62,943 Thanks
    dunstonh
    • #6
    • 9th Aug 18, 10:36 AM
    • #6
    • 9th Aug 18, 10:36 AM
    My question is should I transfer my 1st Pension pot to my 2nd Pension pot?
    Insufficient information available to say. it isnt the only option available either.

    My questions are, Is there!!!8217;s any implications with this?
    You would need financial advice from a pension transfer specialist.

    Do I have to take an annuity at 75?
    no.

    Am I making a big mistake doing this?
    Insufficient information to say.

    I have several ISA investments & no real dependants.
    So, annuity could be a viable option at some point. As well as leaving the DB scheme where is is.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
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