How to choose a pension FSA, and/or do I need to?


T

tinnews

I'm approaching 65 and have three pension funds that I need to do
something with. With the current economic downturn we probably do
actually need to turn them into some income rather than just sitting
on them for a while.

It seems that the only real options are to leave them with the
existing providers to buy an annuity or to go for the 'open market'
option to take the money out and look for the best place to buy an
annuity.

So, how do I choose a good independent adviser? I have a couple of
possibles (one pointed to by HSBC, one recommended by a friend) but
haven't a clue really as to whether they're any good. Alternatively I
suppose I could just do it myself, save the cost of the adviser but
not make such a good choice, probably.

Any/all advice and ideas would be very welcome.
 
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C

cryptogram

Doing it yourself is almost certainly out. How will you know who is the best provider on the day? Are you aware of the various options that can be open to you? Have you asked advisers what they will charge (or have you just made the assumption that going through an adviser will be more expensive than doing it yourself?

Adviser charges are, at the moment, divided into fees or commission. Probably, an adviser that charges a fee will rebate any commission, but you'd need to ask. If you try to do it yourself all that will happen is that the company you choose will give you the same (or possibly worse) deal than you'd have got via the adviser, and avoid having to pay anyone any commission. Ifthe adviser rebates the commssion (something only he can do - not you) then the annuity will be enhanced, but you'll pay him a fee instead (out of your taxed income).
 
C

cryptogram

I should have added, re choosing an adviser, firstly never take any advice (including who to use as an adviser) from a bank. The only thing that should ever be provided by a bank is a current account. That's what they're for and that's what they are good at. Anything else and you're entering a dragon's den.

Go to unbiased.co.uk and try to select one from there, if you're not sure about the one your friend uses.
 
T

tinnews

cryptogram said:
I should have added, re choosing an adviser, firstly never take any advice (including who to use as an adviser) from a bank. The only thing that should ever be provided by a bank is a current account. That's what they're for and that's what they are good at. Anything else and you're entering a dragon's den.

Go to unbiased.co.uk and try to select one from there, if you're not sure about the one your friend uses.
I tried unbiased.co.uk and couldn't find any way to "select one from
there", all that seemed to happen was interminable waffle about why it
would be a good idea to use an IFA.

What I really want is a few recommendations for actual, real, IFAs
that I can contact. Please.
 
C

cryptogram

Strange. It worked for me. Just enter your postcode and select the type of IFA you want. The problem with your question is finding a list that you'd like and who are close enough. I could give you the name of one that I'd trust with my life and who would do you a good job, but then, you don't know me do you? Am I someone you'd like to have as a referrer? Only you can answer that question.

Tell me roughly where you live and whether you want this guy's name.
 
J

Jim

I'm approaching 65 and have three pension funds that I need to do
something with. With the current economic downturn we probably do
actually need to turn them into some income rather than just sitting
on them for a while.

It seems that the only real options are to leave them with the
existing providers to buy an annuity or to go for the 'open market'
option to take the money out and look for the best place to buy an
annuity.

So, how do I choose a good independent adviser? I have a couple of
possibles (one pointed to by HSBC, one recommended by a friend) but
haven't a clue really as to whether they're any good. Alternatively I
suppose I could just do it myself, save the cost of the adviser but
not make such a good choice, probably.

Any/all advice and ideas would be very welcome.
Transfer them all into a SIPP (eg Hargreaves - not that I have any
particular love for HL).
Then take the 25% tax free cash, invest that into cash ISAs, and (when
it comes back) the NS&I inflation linked tax free bond, also taxed
fixed rate bonds (you may not have enough income for the tax burden to
be bad).
Only invest the SIPP money into fairly safe, income yielding stuff
(the hard part)
Take ad-hoc payments as you need them from the SIPP.

Advantages:
You are not providing income to the annuity company.
Hopefully your money may grow in the SIPP (or lose).
It will grow in the ISAs, etc - but barely keeping pace with
inflation.
When you die any remaining can be left to your kids (less an
outrageous 55% tax charge).

Anyway, that's my strategy.
 
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