Pension plans/retirement

[Bellend Sebastian]

8 hours ago, cambridgefox said:

Slightly unrelated but to do with investments.

 

we have put money away in a jump fund(Witan Investment Trust) for my daughter and it’s done better than we expected .its in our name(wife’s and mine).

just before the last election we cashed in just under half as we were playing it safe if there was a sudden drop in shares.

we put this in our National savings.

my wife is self employed for the NFU and has to give details of investments etc

Because each month we send a dd and they buy shares ,over 17 years every month the share price differs.

 

Q1 How do you work out the capital gains as each month the share price is different and we have taken under half out of the total holding.

Q2 We put it in National Savings( in my wife’s)

Alrhough the investment was in joint names the withdrawal funds are in her savings.

Does this mean she is liable for the Capital Gains or is it halved as theoretically half was mine.

@Babylon you seem the man in the know!

@Bellend Sebastian

 

 

I can honestly say I avoid doing CGT calcs on anything other than very simple scenarios whenever possible.

 

The complication I'm your situation was that it was a partial sale. I've only skim read this article but it explains the principles that apply that might help.

 

https://www.google.co.uk/amp/www.telegraph.co.uk/money/ask-a-money-expert/will-taxed-selling-fund-contributed-monthly-decades/amp/

 

If it was jointly held, where the proceeds were paid makes no odds. The gain is split between the two of you, so you can use both your CGT exemptions (£11,300  of GAIN, not proceeds, each in 2017/18) which will swallow up quite a lot of gain, but whether it's enough in your situation I know not, old chap

 

Edited 12 February 2018 by Bellend Sebastian
Would help if I put the bloody link in

[cambridgefox]

29 minutes ago, Bellend Sebastian said:

I can honestly say I avoid doing CGT calcs on anything other than very simple scenarios whenever possible.

 

The complication I'm your situation was that it was a partial sale. I've only skim read this article but it explains the principles that apply that might help.

 

https://www.google.co.uk/amp/www.telegraph.co.uk/money/ask-a-money-expert/will-taxed-selling-fund-contributed-monthly-decades/amp/

 

If it was jointly held, where the proceeds were paid makes no odds. The gain is split between the two of you, so you can use both your CGT exemptions (£11,300  of GAIN, not proceeds, each in 2017/18) which will swallow up quite a lot of gain, but whether it's enough in your situation I know not, old chap

 

Thanks,very much appreciated.

In that case we fall under.Excellent news!

[Izzy]

I've been doing a bit of research on pensions since last posting on here a few weeks ago - fvck me it's a complicated business!

 

I'm usually quite decisive but find myself in a bit of a dilemma. I was thinking about starting a private pension as I thought my old company private pension wasn't worth much.

 

Seems it's worth about £15k per year in today's money and I'm told if I was to transfer it into a private pension it could be worth 20 - 50 times that (so I've just requested a transfer value).

 

I'm getting so many different views from people that have been in this position that I'm really not sure what to do. Seems I've got 2 options.

 

1) Leave the company pension alone, let it grow the start a separate/new private pension and start putting into that every month

 

2) Transfer everything out of my company scheme, use it to start up a private pension and then keep adding to it.

 

There's so much conflicting advice about transferring pensions and I've just confused myself. I've no intention of being an 'old' pensioner and if I get to 70 I'll be happy so early/easy access appeals.

 

I'm usually pretty optimistic but worried I'll get this big decision wrong and regret it. I lost a lot of money buying a franchise a few years ago and it shit me up a bit.

 

[DennisNedry]

The University lecturers striking over pensions - maybe I'm wrong but their terms look generous even after the proposed changes, so I'm struggling to see why they are up in arms really.

 

Also has anybody got any experience in Peer to Peer lending? I've had a mate recommend Funding Circle to me - apparently he's achieving 7% ish returns on the money he's put in there for the last 2 years which obviously beats any ISA/savings accounts but of course comes with risk, so maybe should be more comparable to the stock market in that sense.

[Crinklyfox]

9 hours ago, Izzy Muzzett said:

I've been doing a bit of research on pensions since last posting on here a few weeks ago - fvck me it's a complicated business!

 

I'm usually quite decisive but find myself in a bit of a dilemma. I was thinking about starting a private pension as I thought my old company private pension wasn't worth much.

 

Seems it's worth about £15k per year in today's money and I'm told if I was to transfer it into a private pension it could be worth 20 - 50 times that (so I've just requested a transfer value).

 

I'm getting so many different views from people that have been in this position that I'm really not sure what to do. Seems I've got 2 options.

 

1) Leave the company pension alone, let it grow the start a separate/new private pension and start putting into that every month

 

2) Transfer everything out of my company scheme, use it to start up a private pension and then keep adding to it.

 

There's so much conflicting advice about transferring pensions and I've just confused myself. I've no intention of being an 'old' pensioner and if I get to 70 I'll be happy so early/easy access appeals.

 

I'm usually pretty optimistic but worried I'll get this big decision wrong and regret it. I lost a lot of money buying a franchise a few years ago and it shit me up a bit.

 

Izzy if your company pension is a Defined Benefits scheme then IMO it's unlikely that transfer to another scheme would increase your benefits.

 

Some years ago my employer decided to close the DB pension scheme I was in, which paid a percentage of final salary, and offered staff the chance to transfer it all to a Defined Contributions scheme, which effectively puts you at the mercy of the markets when it comes to annual returns.  I did a few calculations and worked out that I would have to work an additional five years under the DC scheme to get the same returns as I would get under the DB scheme (based on prevailing market conditions at that time).

 

Do yourself a favour and look into how much your pension pot would pay you annually - when I investigated I needed around £30K for every £1K pension payment.  Oh and make sure it's index-linked.  Providers will happily quote you an annual return that never rises with inflation, which may be OK when you retire but if there's any level of inflation you can become very poor very quickly.  There are plenty of brokers out there who would be delighted to sell you a private pension, it's big commission for them because it's a big earner for the pension provider.

 

My employer pressured all the staff to give up their DB scheme and sign a new contract with the DC scheme, in fact they said that anyone who didn't sign the new contract would have resigned from the company as all the old contracts would be terminated.  I left rather than lose my DB pension and have never regretted it, right now it's one of the few certainties in life.  If it was me I'd take your option 1 in a heartbeat.

 

£15K a year may not seem a lot but you can live on it in addition to the state pension once the mortgage has gone.

[VLC86]

9 hours ago, DennisNedry said:

The University lecturers striking over pensions - maybe I'm wrong but their terms look generous even after the proposed changes, so I'm struggling to see why they are up in arms really.

 

Also has anybody got any experience in Peer to Peer lending? I've had a mate recommend Funding Circle to me - apparently he's achieving 7% ish returns on the money he's put in there for the last 2 years which obviously beats any ISA/savings accounts but of course comes with risk, so maybe should be more comparable to the stock market in that sense.

Agree re the lecturers. I was handed a leaflet that suggested they will lose £10k a year which shows just how lucrative their current pension must be.

 

I had my pension statement through the other week and on current contributions it recons I would to live off about £5k per year . Quickly doubled my contribution which in turn means my employer will contribute 3.5% more than I do which isn’t too bad.

[Izzy]

1 hour ago, Crinklyfox said:

Izzy if your company pension is a Defined Benefits scheme then IMO it's unlikely that transfer to another scheme would increase your benefits.

 

Some years ago my employer decided to close the DB pension scheme I was in, which paid a percentage of final salary, and offered staff the chance to transfer it all to a Defined Contributions scheme, which effectively puts you at the mercy of the markets when it comes to annual returns.  I did a few calculations and worked out that I would have to work an additional five years under the DC scheme to get the same returns as I would get under the DB scheme (based on prevailing market conditions at that time).

 

Do yourself a favour and look into how much your pension pot would pay you annually - when I investigated I needed around £30K for every £1K pension payment.  Oh and make sure it's index-linked.  Providers will happily quote you an annual return that never rises with inflation, which may be OK when you retire but if there's any level of inflation you can become very poor very quickly.  There are plenty of brokers out there who would be delighted to sell you a private pension, it's big commission for them because it's a big earner for the pension provider.

 

My employer pressured all the staff to give up their DB scheme and sign a new contract with the DC scheme, in fact they said that anyone who didn't sign the new contract would have resigned from the company as all the old contracts would be terminated.  I left rather than lose my DB pension and have never regretted it, right now it's one of the few certainties in life.  If it was me I'd take your option 1 in a heartbeat.

 

£15K a year may not seem a lot but you can live on it in addition to the state pension once the mortgage has gone.

Many thanks mate, most helpful. Your advice is EXACTLY the same as my 70 year old Dad has given me 

 

My old company pension is a DB scheme and index linked so looks very safe and secure - I can see the sense in just leaving it be. My old man transferred one of his old company pensions to Standard Life in the 90’s and lost a lot of money so he doesn’t want me to suffer the same fate.

 

I guess it’s just the temptation of getting my gruby hands on a big transfer value that appeals. When they wrote to me 10 years ago the transfer value was x4 and my FA reckons it could be 20-50 times this time around.

 

Maybe option 1 makes sense. I can always set up a new private pension for the next 10-20 years and take a bit more risk with that while leaving the company pension alone to do its thing.

 

Thanks again mate, much appreciated.

[Jon the Hat]

Be very wary of anyone telling you to transfer pensions, unless you have a few small ones.  Never leave a DB scheme.

[Buce]

8 minutes ago, Izzy Muzzett said:

Many thanks mate, most helpful. Your advice is EXACTLY the same as my 70 year old Dad has given me 

 

My old company pension is a DB scheme and index linked so looks very safe and secure - I can see the sense in just leaving it be. My old man transferred one of his old company pensions to Standard Life in the 90’s and lost a lot of money so he doesn’t want me to suffer the same fate.

 

I guess it’s just the temptation of getting my gruby hands on a big transfer value that appeals. When they wrote to me 10 years ago the transfer value was x4 and my FA reckons it could be 20-50 times this time around.

 

Maybe option 1 makes sense. I can always set up a new private pension for the next 10-20 years and take a bit more risk with that while leaving the company pension alone to do its thing.

 

Thanks again mate, much appreciated.

4

 

Yeah, but your dad thinks Burnley and London are the same...

[Bellend Sebastian]

Right dudes. Everyone's experiences are interesting but we have to be very careful in this thread telling people what they should and shouldn't do as what is "right" depends on their circumstances which of course vary massively from person to person.

 

Are you married? Do you have a partner?  Do they have a pension? Do you have children? How old are they? Are you in good health? What assets do you have other than your pension? What's your State Pension Entitlement? How much risk are you comfortable with? Do you want to pass on wealth when you die? Are you expecting an inheritance yourself?

 

These and others (these are just the things that I can think of on the spot) can all influence what course of action an individual should take.

 

To illustrate the point, while we're on the subject of final salary pensions, I know of a case where a guy was advised to transfer old benefits out of his final salary scheme; an extreme example but I think proves what I'm on about. He was advised to transfer because he had less than a year to live, had a partner but wasn't married and his kids were all adults. By transferring he then had a fund of several hundred thousand pounds that he could pass on death to literally anyone he liked. If his benefits had stayed in the scheme, nobody would have got anything - years of pension saving gone, just because the Scheme rules were really inflexible

 

 

[Bellend Sebastian]

6 minutes ago, Jon the Hat said:

Be very wary of anyone telling you to transfer pensions, unless you have a few small ones.  Never leave a DB scheme.

Don't leave any scheme that you're an active member of and your employer is contributing to.

 

If it's retained benefits from an old employment then the decision will depend very much on the individual's circumstances. I'm not suggesting that it's not a massive decision that A LOT of care needs to be taken over

[Rogstanley]

Anything more than about 35x transfer value and I’d be inclined to take it tbh. If it was me, that is. I don’t know what other people should do.

Edited 25 February 2018 by Rogstanley

[Crinklyfox]

1 hour ago, Costock_Fox said:

Agree re the lecturers. I was handed a leaflet that suggested they will lose £10k a year which shows just how lucrative their current pension must be.

 

I had my pension statement through the other week and on current contributions it recons I would to live off about £5k per year . Quickly doubled my contribution which in turn means my employer will contribute 3.5% more than I do which isn’t too bad.

The lecturers may have a good pension package, however I have every sympathy with them as the pension they were offered formed part of their contract and having it withdrawn and a less generous option offered still amounts to the employer going back on the contractual agreement.  What has happened in recent years is in my eyes no less than legalised pensions theft suffered by millions, the lecturers are simply one of the last groups to experience this fate.

 

Good move to up your pension contributions if you're in a DB scheme especially if your employer is contributing - for many years some employers gave themselves a 'pensions holiday' and the only contributions were made by the employee.  I find that in retirement I need less than in my working life with the mortgage and children, but the rates, household bills, car expenses, etc. are still the same so living off £5 per year is a non-starter.

[Izzy]

1 hour ago, Bellend Sebastian said:

 

To illustrate the point, while we're on the subject of final salary pensions, I know of a case where a guy was advised to transfer old benefits out of his final salary scheme; an extreme example but I think proves what I'm on about. He was advised to transfer because he had less than a year to live, had a partner but wasn't married and his kids were all adults. By transferring he then had a fund of several hundred thousand pounds that he could pass on death to literally anyone he liked. If his benefits had stayed in the scheme, nobody would have got anything - years of pension saving gone, just because the Scheme rules were really inflexible

 

This bit is important - we’ll to me anyway.

 

My health is poor and I can’t envisage living must past 70 tbh. I’ve no interest in being an old pensioner.

 

It looks like my old company final salary pension will pay my wife 50% of my deferred pension if I die before retirement age and also 50% of whatever I’d be receiving if I die after retirement age.

 

My understanding is that she’d get 100% of if I transferred it to a private pension which really appeals.

 

I’m also too high risk for life insurance and don’t have any as the premiums are astronomical so I also need to factor that in.

 

Like you say, there’s so many individual circumstances to consider that it’s not as easy as just a ‘yes do it’ or ‘no don’t do it’ answer..

 

Hopefully my FA will give me honest and personal advice but I’m worried he’ll tell me to transfer it all just because he wants the commission...

[VLC86]

41 minutes ago, Crinklyfox said:

The lecturers may have a good pension package, however I have every sympathy with them as the pension they were offered formed part of their contract and having it withdrawn and a less generous option offered still amounts to the employer going back on the contractual agreement.  What has happened in recent years is in my eyes no less than legalised pensions theft suffered by millions, the lecturers are simply one of the last groups to experience this fate.

 

Good move to up your pension contributions if you're in a DB scheme especially if your employer is contributing - for many years some employers gave themselves a 'pensions holiday' and the only contributions were made by the employee.  I find that in retirement I need less than in my working life with the mortgage and children, but the rates, household bills, car expenses, etc. are still the same so living off £5 per year is a non-starter.

 yeah **** living off £5 a year....

[Crinklyfox]

1 hour ago, Costock_Fox said:

 yeah **** living off £5 a year....

Well if I'm going to do a typo may as well make it a good one - £5K  

[VLC86]

4 minutes ago, Crinklyfox said:

Well if I'm going to do a typo may as well make it a good one - £5K  

5k now will probably be £5 when I retire anyway.

[m4DD0gg]

On 24/02/2018 at 21:32, Izzy Muzzett said:

I've been doing a bit of research on pensions since last posting on here a few weeks ago - fvck me it's a complicated business!

 

I'm usually quite decisive but find myself in a bit of a dilemma. I was thinking about starting a private pension as I thought my old company private pension wasn't worth much.

 

Seems it's worth about £15k per year in today's money and I'm told if I was to transfer it into a private pension it could be worth 20 - 50 times that (so I've just requested a transfer value).

 

I'm getting so many different views from people that have been in this position that I'm really not sure what to do. Seems I've got 2 options.

 

1) Leave the company pension alone, let it grow the start a separate/new private pension and start putting into that every month

 

2) Transfer everything out of my company scheme, use it to start up a private pension and then keep adding to it.

 

There's so much conflicting advice about transferring pensions and I've just confused myself. I've no intention of being an 'old' pensioner and if I get to 70 I'll be happy so early/easy access appeals.

 

I'm usually pretty optimistic but worried I'll get this big decision wrong and regret it. I lost a lot of money buying a franchise a few years ago and it shit me up a bit.

 

Speak to a financial advisor

[Bobby Hundreds]

On 2/25/2018 at 08:17, Costock_Fox said:

Agree re the lecturers. I was handed a leaflet that suggested they will lose £10k a year which shows just how lucrative their current pension must be.

 

I had my pension statement through the other week and on current contributions it recons I would to live off about £5k per year . Quickly doubled my contribution which in turn means my employer will contribute 3.5% more than I do which isn’t too bad.

From 16-19k pa. It's pretty appalling tbf.

[Marmite]

Since Xmas I have started to save £100 a month for when I retire in around 30 years. I am thinking about buying £100 worth of premium bonds each month or would it be best to pay it straight into an ISA account? 

 

[Vardinio'sCat]

On 2/25/2018 at 11:03, Izzy Muzzett said:

This bit is important - we’ll to me anyway.

 

My health is poor and I can’t envisage living must past 70 tbh. I’ve no interest in being an old pensioner.

 

It looks like my old company final salary pension will pay my wife 50% of my deferred pension if I die before retirement age and also 50% of whatever I’d be receiving if I die after retirement age.

 

My understanding is that she’d get 100% of if I transferred it to a private pension which really appeals.

 

I’m also too high risk for life insurance and don’t have any as the premiums are astronomical so I also need to factor that in.

 

Like you say, there’s so many individual circumstances to consider that it’s not as easy as just a ‘yes do it’ or ‘no don’t do it’ answer..

 

Hopefully my FA will give me honest and personal advice but I’m worried he’ll tell me to transfer it all just because he wants the commission...

 

Shit, I hoped you burned bright mate...

 

I'm looking to get to at least 73, probably just after me parents at the rate I'm/their going. Packing in the fags might help a bit  I might have to push one of the olds down the stairs if things get desperate.

[Vardinio'sCat]

 

How come we have one of the most highly developed financial services sectors in the world, yet pension provision has been decimated?

 

My mum retiring at 55 didn't help, obviously, but still.

[Rob1742]

On ‎2‎/‎24‎/‎2018 at 21:32, Izzy Muzzett said:

I've been doing a bit of research on pensions since last posting on here a few weeks ago - fvck me it's a complicated business!

 

I'm usually quite decisive but find myself in a bit of a dilemma. I was thinking about starting a private pension as I thought my old company private pension wasn't worth much.

 

Seems it's worth about £15k per year in today's money and I'm told if I was to transfer it into a private pension it could be worth 20 - 50 times that (so I've just requested a transfer value).

 

I'm getting so many different views from people that have been in this position that I'm really not sure what to do. Seems I've got 2 options.

 

1) Leave the company pension alone, let it grow the start a separate/new private pension and start putting into that every month

 

2) Transfer everything out of my company scheme, use it to start up a private pension and then keep adding to it.

 

There's so much conflicting advice about transferring pensions and I've just confused myself. I've no intention of being an 'old' pensioner and if I get to 70 I'll be happy so early/easy access appeals.

 

I'm usually pretty optimistic but worried I'll get this big decision wrong and regret it. I lost a lot of money buying a franchise a few years ago and it shit me up a bit.

 

Go to a financial advisor, they will say they will look at it independently, then they will transfer it, or tell you its not up to much and they can do better. So what I am saying is, just leave it as it is as you can't trust their advice as they will just want to get commission on creating a new scheme or transferring it.

[Rob1742]

On ‎2‎/‎25‎/‎2018 at 11:03, Izzy Muzzett said:

This bit is important - we’ll to me anyway.

 

My health is poor and I can’t envisage living must past 70 tbh. I’ve no interest in being an old pensioner.

 

It looks like my old company final salary pension will pay my wife 50% of my deferred pension if I die before retirement age and also 50% of whatever I’d be receiving if I die after retirement age.

 

My understanding is that she’d get 100% of if I transferred it to a private pension which really appeals.

 

I’m also too high risk for life insurance and don’t have any as the premiums are astronomical so I also need to factor that in.

 

Like you say, there’s so many individual circumstances to consider that it’s not as easy as just a ‘yes do it’ or ‘no don’t do it’ answer..

 

Hopefully my FA will give me honest and personal advice but I’m worried he’ll tell me to transfer it all just because he wants the commission...

They never give honest advice. They only make money by doing something, so unfortunately you need to do the homework yourself rather than rely on them. I have seen loads of them, and everyone has just been interested in selling something or getting their hands on your pension commissions. They are basically robbers in suits, hiding behind a nice title.

[Izzy]

15 minutes ago, Rob1742 said:

Go to a financial advisor, they will say they will look at it independently, then they will transfer it, or tell you its not up to much and they can do better. So what I am saying is, just leave it as it is as you can't trust their advice as they will just want to get commission on creating a new scheme or transferring it.

 

11 minutes ago, Rob1742 said:

They never give honest advice. They only make money by doing something, so unfortunately you need to do the homework yourself rather than rely on them. I have seen loads of them, and everyone has just been interested in selling something or getting their hands on your pension commissions. They are basically robbers in suits, hiding behind a nice title.

But what do you really think about Financial Advisers Rob?  

 

As it happens I've just received the transfer value today and it's x 22 - which is a bit less than I'd hoped for. My FA had given examples of 30-50 times transfer values and I'd probably have been tempted if I'd been offered those sorts of figures.

 

So I'll probably leave my old company pension 'as is' and just set up a separate new private pension from scratch and put into that each month from now on.

 

Cheers