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Post by MungO on Nov 20, 2022 14:53:11 GMT
I have 3 or 4 different pensions at varying values through different companies i have worked for over the years.
I'm only contributing to one at the moment (my current employer).
What is the benefit or pitfalls of consolidating them all?
All the pensions i hold are with reputable providers (Aegon, Aviva, Scottish Widows, Fidelity, etc) if that makes a difference.
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Post by arrgee on Nov 21, 2022 16:58:09 GMT
I have 3 or 4 different pensions at varying values through different companies i have worked for over the years. I'm only contributing to one at the moment (my current employer). What is the benefit or pitfalls of consolidating them all? All the pensions i hold are with reputable providers (Aegon, Aviva, Scottish Widows, Fidelity, etc) if that makes a difference. I consolidated all mine a few years ago into my employers pension with L&G ahead of retirement, so I didn’t have to mess around cashing them in separately. pitfalls* trading costs to sell out of one pension and buying into another with the spreads * if any of your pots are worth less than £10k they don’t contribute to LTA; however only an issue if you are likely to hit LTA benefits* easy to track LTA usage if you just crystallise under one provider * possible to reduce charges - e.g. ii.co.uk can cost just £156/annum which is 0.03% of a £500k pot www.which.co.uk/money/pensions-and-retirement/options-for-cashing-in-your-pensions/income-drawdown/compare-pension-drawdown-plans-and-charges-ax1628r13rdk* wider range of funds available Probably other considerations, but for me consolidating was worthwhile. |
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Post by MungO on Nov 21, 2022 17:44:08 GMT
I have 3 or 4 different pensions at varying values through different companies i have worked for over the years. I'm only contributing to one at the moment (my current employer). What is the benefit or pitfalls of consolidating them all? All the pensions i hold are with reputable providers (Aegon, Aviva, Scottish Widows, Fidelity, etc) if that makes a difference. I consolidated all mine a few years ago into my employers pension with L&G ahead of retirement, so I didn’t have to mess around cashing them in separately. pitfalls* trading costs to sell out of one pension and buying into another with the spreads * if any of your pots are worth less than £10k they don’t contribute to LTA; however only an issue if you are likely to hit LTA benefits* easy to track LTA usage if you just crystallise under one provider * possible to reduce charges - e.g. ii.co.uk can cost just £156/annum which is 0.03% of a £500k pot www.which.co.uk/money/pensions-and-retirement/options-for-cashing-in-your-pensions/income-drawdown/compare-pension-drawdown-plans-and-charges-ax1628r13rdk* wider range of funds available Probably other considerations, but for me consolidating was worthwhile. Excellent stuff. All the pots are over the LTA threshold of £10k, but none are anywhere near the LTA limit! Even combined! |
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Post by redshank on Jan 4, 2023 14:07:34 GMT
Lots of what I read suggest Isas.I listened and acted on a financial advisors advice just once and almost lost everything I worked and hurt myself for.The FSA were useless,I got my local conservative MP involved and within a few days all was resolved despite some interest loss.Now I cover every penny I save as I am in no condition to start earning money.
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Post by arrgee on Jan 4, 2023 14:46:16 GMT
Lots of what I read suggest Isas.I listened and acted on a financial advisors advice just once and almost lost everything I worked and hurt myself for.The FSA were useless,I got my local conservative MP involved and within a few days all was resolved despite some interest loss.Now I cover every penny I save as I am in no condition to start earning money. Can get a self select ISA from ii.co.uk and buy investment trusts and iShares. May not make a fortune, but safe enough. Never had a financial advisor. Best thing about ISAs is you can get all the money out of one instantly. This was very handy when I bought my house and when I extended it. Taking money out of pensions normally means paying income tax, though there is the 25% tax free cash which I took at the first opportunity. Pensions are better than ISAs if you are employed as you get tax relief and if you use salary sacrifice, like I did, you can get the employers NI added as well. Also you can avoid HICBC if you have children and you make your salary under £50k. Pensions are good if you don’t pay tax as you can put in your entire income with the government topping up. So if like my wife you earn £12.5k, you put £10k in and government add £2.5k. Of course it is me putting that money in for my wife  . And if you don’t work, you can add £2880, get the government to add £720 and withdraw £900 tax free leaving the remaining £2700 to grow, which is what I am doing now I have retired. Pensions are also currently free of IHT, but the rules may change and unless you die before 75, your beneficiaries will have to pay income tax on any withdrawals. LTA can be an issue if you have a big pension over £1m; that would be a nice problem to have |
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. And if you don’t work, you can add £2880, get the government to add £720 and withdraw £900 tax free leaving the remaining £2700 to grow, which is what I am doing now I have retired.