UKPersonal Pension - More Advice Needed, 55 Year Old.

[Formaleins]

OK, I posted a topic on this earlier but really nothing concrete came of it as most advice was either general or was jumped on by the "Pension Transfer Schemers" that I specifically did not want anything to do with.

Well, my pension company, Abbey Like has sent me a list of options updated for my 55th birthday and I am toying with two scenario's.

 

NOTE! The utmost importance for me with either of these options is to get my paws on the tax free lump sums! so as it stands at the moment I can take option 1, this gives me a tax free lump sum of XX pounds, with a yearly (Joint Life) pension of XX, of which my wife will get 50% if I kick the bucket. (This would be the easiest option as it basically leaves everything with Abbey, who to be honest have been pretty reasonable, however the pension is a bit on the low side and the 50% if I die seems a bit paltry)

 

So then there is option 2, again a lump sum of 25% Tax free, then a Market Value Transfer of the balance, obviously no pension. This balance can only be transferred to another UK or Foreign approved pension plan.

 

Now, within this deal, there are two funds, one is "Protected Rights" and the other is "Personal Pension" Both seem to operate the same way, leave them all in Abbey, take 25% and leave the balance with Abbey, (with various yearly pension options) Take everything out and get taxed at Emergency Rate....ho ho, there's a laugh! Or take the 25% then transfer the remainder to another pension fund.

 

This is where I hope someone can again shed some light.

 

My thinking at the moment is I want the 25% Tax free, this is my one requirement. My second thought is to transfer all of the remainder out of Abbey and invest it elsewhere.

 

Now, I have heard of a scheme in the UK called SIPP's from what I can gather it would allow me to invest the balance in whichever way I wanted within the boundaries of the scheme, and it also allows for withdrawals that can be tax free if you keep within limits.

 

So, does anyone know if it is possible to take all of the balance from Abbey, then open one of these SIPP funds and invest all of the money into one single blue chip stock? or, are the SIPP's governed in some way by the investment company that prevents you investing in one particular stock?

 

I see also that they like to stick on charges, about 120 quid per year for the management, then another 120 quid per year once you start to take out cash. (Not all of them are so greedy, but the one's I have seen that offer a lot better rates do not ring happy bells in my head as they are mostly some no name funds or companies. I would prefer not to pay the charges, but on the other hand, would rather pay than be stitched up at a later date.)

 

So, any advice? One company told me I have to speak to an independent financial adviser - Is this some sort of legal thing or can I just lie on the form and tell them yes, I have spoken to a financial adviser and am happy to carry on?

 

Cheers!

 

Oh, and by the way, I need to be able to put all this in place from here in Thailand.

Edited May 9, 2019 by Formaleins

[CharlieH]

Wrong forum!

 

MOVED

[grollies]

4 hours ago, Formaleins said:

So then there is option 2, again a lump sum of 25% Tax free, then a Market Value Transfer of the balance, obviously no pension. This balance can only be transferred to another UK or Foreign approved pension plan.

Simply transferring from your existing pension to another UK pension defined benefit scheme seems a bit of a waste of time and money as you will incur transfer fees and new set-up fees. You can transfer into a QROPS scheme abroad. Thailand has no QROPS scheme but you can still transfer your pension abroad (link:http://www.qropsspecialists.com/qrops-thailand/)

 

4 hours ago, Formaleins said:

Now, I have heard of a scheme in the UK called SIPP's from what I can gather it would allow me to invest the balance in whichever way I wanted within the boundaries of the scheme, and it also allows for withdrawals that can be tax free if you keep within limits. 

 

So, does anyone know if it is possible to take all of the balance from Abbey, then open one of these SIPP funds and invest all of the money into one single blue chip stock? or, are the SIPP's governed in some way by the investment company that prevents you investing in one particular stock?

You can transfer into a SIPP. Would you seriously invest it all in one fund or stock???? No way. (Link: https://www.myexpatsipp.com)

 

4 hours ago, Formaleins said:

I see also that they like to stick on charges, about 120 quid per year for the management, then another 120 quid per year once you start to take out cash. (Not all of them are so greedy, but the one's I have seen that offer a lot better rates do not ring happy bells in my head as they are mostly some no name funds or companies. I would prefer not to pay the charges, but on the other hand, would rather pay than be stitched up at a later date.)

Typically, SIPP fees consist of a set-up charge and then an annual charge of 0.5%

 

I have a SSAS pension that I am looking to move to a SIPP. My annual fees are around £850p.a. For me my fees going into a SIPP would increase at 0.5% so I'm thinking carefully at the moment.

 

4 hours ago, Formaleins said:

So, any advice? One company told me I have to speak to an independent financial adviser - Is this some sort of legal thing or can I just lie on the form and tell them yes, I have spoken to a financial adviser and am happy to carry on?

 

Yep, don't lie. Never. Ever. It is a legal requirement to seek advice from an independant FSA if transferring from a defined benefits scheme and you'll have to prove you've taken advice (i.e. your IFSA will help arrange any transfer (for a nice fat fee)). With a SSAS the rules are different so I'm taking my time and doing a lot of reasearch. Bit of a minefield mate. Take your time and take advice.

 

I'm certainly not going to offer any, other the last bit and a couple of links (Disclaimer: I'm definately NOT advocating or recommending and pension company, simply offering-up info from Google searches) . Good luck with it.

Edited May 10, 2019 by grollies
spelling

[UKresonant]

You could transfer the whole of the Abbey, into a SIPP as cash or near cash, then you move a component of that SIPP in to "draw down" taking 25% of that as the tax free cash.

 

(If you leave the active bit of the SIPP open, you can add, as a UK tax resident, upto £3600 incl tax relief).

 

QROPS are Tax mine field, you could get it then hit with 55% tax bill later ( once the provider has scarpered).

 

Don't need a financial adviser most times.

Financial advice if transferring out of a defined benefit pension, with a value exceeding £30000.

 

One stock! Unless its a long established investment trust, too scary.

Stocks are good for the static bit you never sell or very infrequently (factor in trading and stamp costs), funds good for liquidity if you sell bits and pieces (as costs could be in the platform fee already).

 

platform charges look for below 0.46%

 

Lots of things to consider for fees

Total value

Facilities, trading fees, variety of funds and shares.

Do they charge for withdrawals, once in drawdown etc.

I know one provider, fixed fee regardless of amount, do charge another fee for withdrawals.  Very much your choice of flavour.

 

Edited May 10, 2019 by johnwf1963

[BritManToo]

9 hours ago, Formaleins said:

So, does anyone know if it is possible to take all of the balance from Abbey, then open one of these SIPP funds and invest all of the money into one single blue chip stock? or, are the SIPP's governed in some way by the investment company that prevents you investing in one particular stock?

 

Hargreaves Lansdown

The only pension company that didn't obviously cheat or steal from me.

You can take your 25% then use drawdown every year and invest how you like ....... all online.

Only the original application needs to be made from within the UK.

 

No legit UK firm will accept new SIPP accounts from customers living outside the UK, but you can get away with using a UK mailing address and not mentioning you live elsewhere.
 

Edited May 10, 2019 by BritManToo

[prakhonchai nick]

I have recently been assisting a widow. Her husband had a SIPP, which I think allows you to effectively choose your investments. Can be quite expensive. When he died, the Dubai arm of the SIPP company, flew their rep to Bangkok, within days of the death and persuaded her to transfer to a QROPS scheme.She knew absolutely nothing and trusted the man as her husband had dealt with him

 

The QROPS management team in the middle east do what they want. They maximise their profits on top of the large fees. Invest in companies where they get a kick back and where the funds do not grow. Annual fees are around £5,000!

 

After 6 months of total mis - management on the part of the QROPS company and others I managed to get back £104,000 for the widow. 3 years earlier her investment was £175.000.

 

My advice is to steer well clear of QROPS,. and be very very careful with everything else.

[UKresonant]

25 minutes ago, BritManToo said:

Hargreaves Lansdown

 

 

 

Yes, can also say no problems with HL. Good website, good help on the phone,( they have a currency transfer service as well, though you have to phone for Thai Baht).

The Abbey sounds like they are offering annuity, if absolutely safety, and making a return is not important, could be OK.

But the SIPP 75% Remaining is likely written in trust, and value can be passed on, nominate beneficiary etc has the chance to grow (or fall) tax free generally with the world markets until drawn. (you still have taxable access to it and could take dividends). SIPP likely tax free as a death benefit.

 

 

Edited May 10, 2019 by johnwf1963

[Saltire]

I have been living for the past 5 years on a SIPP with Standard Life. It was set up a long time ago and any pensions from various employers were evaluated by my (great) Financial Advisor and if appropriate, were transferred into it over the years. I stopped working 8 years ago at age 56. I took the 25% initially and agreed an investment risk with my FA for the balance, choosing low to medium risk. It grew steadily but modestly. Every year I drew down enough to keep me just under the 40% taxation, and minimised the 20% tax as much as possible, most years paying tax, but not massively.

 

That fund is now empty but that was my plan. I have another pension which goes way back to my first job with Rolls Royce and was a final salary scheme. When I left RR my FA said to leave it, but moved it to a Section 32 scheme which came with a guaranteed minimum pension. Great advice as I will take this pension soon and the value of it now would only buy me half the GMP. I am not a high risk taker, I have a great fear of losing! 

 

I also looked into QROPS, way too risky for me, agree with other posters on this.

 

Good luck

 

[crazykopite]

When I did mine which was a few years back I shopped around and ended up with Canada life as they were offering me a better monthly deal than the company I had paid into for 15+ years . I took the lump sum and have my pension paid into my U.K. bank each month unfortunately due to other pensions along with OAP I am taxed at source and there is nothing I can do about it . HMRC love grabbing your hard earned money even in retirement. I would suggest you shop around as I am confident that you will find a better deal than what is being offered if you don’t want to do the research there are companies that will do it for you you are not charged for this service as they get some form of commission if you decided to switch Hargreaves rings a bell maybe do a google search . But yes take the lump sum.

[topt]

If the OP has not seen it some possibly relevant recent

information in this thread that is worth reading -

 

10 hours ago, Formaleins said:

Now, I have heard of a scheme in the UK called SIPP's

Based on that statement I would also suggest it is worth you doing a lot more reading on what exactly SIPPs are and what you can do.........

 

3 of the bigger (non pension company) SIPPs providers who have information on their web sites and discussed in the above thread-

Hargreaves Lansdown - https://www.hl.co.uk/pensions

Interactive Investor - https://www.ii.co.uk/ii-accounts/sipp

AJ Bell - https://www.youinvest.co.uk/sipp/what-is-a-sipp

[UKresonant]

Can I tag on another, non-pension company, flat fee, if the value is high enough, may appeal with the single stock notion (no advice here though)

https://www.share.com/investment-accounts/self-invested-personal-pension

[grollies]

54 minutes ago, johnwf1963 said:

Can I tag on another, non-pension company, flat fee, if the value is high enough, may appeal with the single stock notion (no advice here though)

https://www.share.com/investment-accounts/self-invested-personal-pension

This is just transferring into a managed SIPP. I doubt even they would advocate bunging your whole investment into a single stockholding. Thanks for the link though.

[baansgr]

9 hours ago, grollies said:

Simply transferring from your existing pension to another UK pension defined benefit scheme seems a bit of a waste of time and money as you will incur transfer fees and new set-up fees. You can transfer into a QROPS scheme abroad. Thailand has no QROPS scheme but you can still transfer your pension abroad (link:http://www.qropsspecialists.com/qrops-thailand/)

 

You can transfer into a SIPP. Would you seriously invest it all in one fund or stock???? No way. (Link: https://www.myexpatsipp.com)

 

Typically, SIPP fees consist of a set-up charge and then an annual charge of 0.5%

 

I have a SSAS pension that I am looking to move to a SIPP. My annual fees are around £850p.a. For me my fees going into a SIPP would increase at 0.5% so I'm thinking carefully at the moment.

 

 

Yep, don't lie. Never. Ever. It is a legal requirement to seek advice from an independant FSA if transferring from a defined benefits scheme and you'll have to prove you've taken advice (i.e. your IFSA will help arrange any transfer (for a nice fat fee)). With a SSAS the rules are different so I'm taking my time and doing a lot of reasearch. Bit of a minefield mate. Take your time and take advice.

 

I'm certainly not going to offer any, other the last bit and a couple of links (Disclaimer: I'm definately NOT advocating or recommending and pension company, simply offering-up info from Google searches) . Good luck with it.

Maybe I missed something but OP has a defined contribution plan...personal pension not a defined benefit/company scheme???

[baansgr]

Drawdown is still available. The quotes Abbey gave you will be for spouses pension and probably RPI or CPI increases. Ask for a quote, single life, level, paid in arrears with a 10 year guarantee, the monthly pension will be double what they have quoted. You can shop around for the beat rates using your open market option

 

[baansgr]

5 hours ago, prakhonchai nick said:

I have recently been assisting a widow. Her husband had a SIPP, which I think allows you to effectively choose your investments. Can be quite expensive. When he died, the Dubai arm of the SIPP company, flew their rep to Bangkok, within days of the death and persuaded her to transfer to a QROPS scheme.She knew absolutely nothing and trusted the man as her husband had dealt with him

 

The QROPS management team in the middle east do what they want. They maximise their profits on top of the large fees. Invest in companies where they get a kick back and where the funds do not grow. Annual fees are around £5,000!

 

After 6 months of total mis - management on the part of the QROPS company and others I managed to get back £104,000 for the widow. 3 years earlier her investment was £175.000.

 

My advice is to steer well clear of QROPS,. and be very very careful with everything else.

Devere springs to mind

[Formaleins]

11 hours ago, grollies said:

Simply transferring from your existing pension to another UK pension defined benefit scheme seems a bit of a waste of time and money as you will incur transfer fees and new set-up fees. You can transfer into a QROPS scheme abroad. Thailand has no QROPS scheme but you can still transfer your pension abroad (link:http://www.qropsspecialists.com/qrops-thailand/)

 

You can transfer into a SIPP. Would you seriously invest it all in one fund or stock???? No way. (Link: https://www.myexpatsipp.com)

 

Typically, SIPP fees consist of a set-up charge and then an annual charge of 0.5%

 

I have a SSAS pension that I am looking to move to a SIPP. My annual fees are around £850p.a. For me my fees going into a SIPP would increase at 0.5% so I'm thinking carefully at the moment.

 

 

Yep, don't lie. Never. Ever. It is a legal requirement to seek advice from an independant FSA if transferring from a defined benefits scheme and you'll have to prove you've taken advice (i.e. your IFSA will help arrange any transfer (for a nice fat fee)). With a SSAS the rules are different so I'm taking my time and doing a lot of reasearch. Bit of a minefield mate. Take your time and take advice.

 

I'm certainly not going to offer any, other the last bit and a couple of links (Disclaimer: I'm definately NOT advocating or recommending and pension company, simply offering-up info from Google searches) . Good luck with it.

Thanks, some interesting info!

[Formaleins]

6 hours ago, johnwf1963 said:

You could transfer the whole of the Abbey, into a SIPP as cash or near cash, then you move a component of that SIPP in to "draw down" taking 25% of that as the tax free cash.

 

(If you leave the active bit of the SIPP open, you can add, as a UK tax resident, upto £3600 incl tax relief).

 

QROPS are Tax mine field, you could get it then hit with 55% tax bill later ( once the provider has scarpered).

 

Don't need a financial adviser most times.

Financial advice if transferring out of a defined benefit pension, with a value exceeding £30000.

 

One stock! Unless its a long established investment trust, too scary.

Stocks are good for the static bit you never sell or very infrequently (factor in trading and stamp costs), funds good for liquidity if you sell bits and pieces (as costs could be in the platform fee already).

 

platform charges look for below 0.46%

 

Lots of things to consider for fees

Total value

Facilities, trading fees, variety of funds and shares.

Do they charge for withdrawals, once in drawdown etc.

I know one provider, fixed fee regardless of amount, do charge another fee for withdrawals.  Very much your choice of flavour.

 

Migraine and headaches abound with all this stuff, it was easier when they let you die before you got to the cash!

[Formaleins]

6 hours ago, BritManToo said:

Hargreaves Lansdown

The only pension company that didn't obviously cheat or steal from me.

You can take your 25% then use drawdown every year and invest how you like ....... all online.

Only the original application needs to be made from within the UK.

 

No legit UK firm will accept new SIPP accounts from customers living outside the UK, but you can get away with using a UK mailing address and not mentioning you live elsewhere.
 

Thanks, I will take a look! cheers.

[Formaleins]

Thanks for all the advice, I will settle down and digest it the best I can over the next day or two, some really interesting comments. I was thinking of bunging the lot into SHELL, it would almost double what Abbey was paying.

Edited May 10, 2019 by Formaleins

[UKresonant]

I would suggest a bit of reading on long established Investment trusts, they may give you a bit more diversification. Lots of UK Income & growth trusts with a good history of progressive, stable increasing dividend streams...over decades.

I've found they few single equities I have, to show volatile pricing, one is currently +20% and another is -20% share price, but their dividend streams are stable.