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19 Feb 20, 06:37 PM |
#51
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Imagineer
Join Date: Feb 13
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Depending on the individual you get, PW can be hit and miss. Many of them are retired advisors and can be a wealth of knowledge and experience. Some very young and just have text book basics to work with.
They can generally give you generic type information. If you have all your financial details with you, they may also be able to give you a better steer. My OH is getting a one hour free with a local IFA. This is first thing in the morning. Check if your employer or union offers this. My employer offered sessions with a company called Wealth at Work. My OH's is through her union. It might be worth seeing an IFA. Many people refuse this because they can charge a bit. But that cost might be offset many times over as you likely have a few decades of time for the cost of advice to pay back. Or spend the time learning your self. I find it fascinating so that's what I did. I used an IFA initially, learnt from that and much reading. The advantage each of us has is that we only need to learn the bits relevant to our individual circumstances. An IFA has to learn about every persons' circumstances and many other things. Edited at 06:42 PM. |
19 Feb 20, 07:35 PM |
#52
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Imagineer
Join Date: Mar 02
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The DB was closed ten years ago. I have just over 27 years pensionable service in it so the DB is enough to live comfortably.
I have been paying into the DC for ten years. It is done by salary sacrifice, I and my employer both contribute 10% of my salary. All things behind equal by the time I want to retire there should be just north of 140k in it. Then 2 and a half years later there the DB. Take the lump sum, pay off the mortgage and bank the remainder. I'm seeing Pension Wise not because I'm two years out so there's plenty of time to seek further advice if necessary. Edited at 07:38 PM. |
19 Feb 20, 07:53 PM |
#53
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Imagineer
Join Date: Feb 13
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Salary Sacrifice is fantastic. Especially if a basic rate tax payer as National Insurance is 12% (I think). By my maths that actually gives you a 47% top up / uplift rather than 25%. Plus your company give you 10%.
In your circumstances I think I would be putting as much as I possibly could into this and living from savings of you have them. That is what I did for a few years before retiring. The trick here is working out how to take all this pension out in the most tax efficient way. For example, many have come across actuarial reductions on a DB pension for taking it early (often around 5% per year). But some (mine included) allow an actuarial increase for delaying. Might be worth finding this out. If you can do this it would be worth doing the sums to see if delaying your DM pension and using another year's tax free allowance to take from your DC pensions works out better. I am doing the reverse and taking my DB 5 years early as the actuarial reductions were changed to 3% per year. Makes it a no brainer for me. This is one of my big questions about my OH's pension - actuarial increases. I suspect her scheme doenst allow this - but I will know tomorrow. |
19 Feb 20, 08:07 PM |
#54
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Imagineer
Join Date: Mar 02
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My DB provider has a website that gives me projections for what I'll get based on whatever dates I put it. I realise these are guesstimates but it gives me something to go on.
There is a reduction for taking the DB before 63 (actually a month after I'm 63). It doesn't allow for projections after that unfortunately but if it gets to somewhere close I'll be okay, with the remainder of my lump sum and the remainder of the DC to supplement it. Then four years later I'll get the full SP on top. I'm happy with my DB contributions at the level they are and the differences in how to take the DC don't appear to be massive. It's all about deciding really. Many thanks for your responses, it's very interesting if s little confusing. Edited at 09:23 PM. |
19 Feb 20, 08:55 PM |
#55
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Imagineer
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Loftus, just one thing to mention re making further contributions to the DC plan - you just need to ensure you have only made withdrawals of the tax free cash element, otherwise you will be subject to a hefty reduction in your annual allowance (the amount you can pay in pension contributions in any tax year and receive tax relief on) Your employer contributions are counted towards this annual allowance, and given the amount being contributed you would likely be restricted should you fall foul of this. It's fine as long as you are only accessing the tax free cash element (either in whole or phased), but should you withdraw anything else from the crystallised element then the reduction will kick in.
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19 Feb 20, 09:03 PM |
#56
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Imagineer
Join Date: Feb 13
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19 Feb 20, 09:19 PM |
#57
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Imagineer
Join Date: Oct 09
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Yes, As far as i am aware you can carry forward for the unused allce for the 3 previous tax years. To effectively mop up
Dont forget you need income in the was is CURRENT tax year to be able to do this Disney332
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Edited at 09:21 PM. |
19 Feb 20, 09:20 PM |
#58
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Imagineer
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That's the one - the Money Purchase Annual Allowance.
My understanding is, once the MPAA is triggered, you also lose the ability to carry forward - which makes sense, given its purpose.
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19 Feb 20, 09:22 PM |
#59
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Imagineer
Join Date: Mar 02
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19 Feb 20, 09:27 PM |
#60
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Imagineer
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I don't believe this is the case when you are subject to the Money Purchase Annual Allowance
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