Pension 101

[Moneynoob]

I am 45 and starting to panic with how little I have saved in pensions and also how little I know! I’ve worked full time since leaving uni and have around 150k split across multiple past employers. I’ve always been a spender so have largely sought to only take employer contributions and never topped up myself.

this is going to change! I’m hoping g someone can point me in direction of or provide some high level guidance on what I need to consider. Advisors seems £££ are they worth it? Confused about annuity and other types, would would be best as a legacy for my kids. Assuming my pension won’t die with me?

Don’t panic!

I am assuming that you are not in a NHS, teacher’s, civil service or other public sector pension?

I found a pension advisor by first going to one of the free Gvt advisory services and then contacting some advisors from an approved list. I interviewed a few. The one I picked gave me a huge detailed personalised presentation (from info I gave him) of how he would manage my pension and the services he would provide, all very easy to understand. I didn’t pay a fee, he managed the transfer of my rag bag of different pensions, put them all together in a better performing pension with lower fund fees than I had paid, and he takes a % fee (but the fund fees and his fees were no more than I had previously paid in fund fees!

He makes 2 appointments a year with updated graphs etc, and also holds online meetings whenever I ask for them. .

You have what… another 15 years to save? It really is worth adding your own contributions because the Gvt then add another 20% (if you are a basic rate tax payer).

You don’t need to decide now between an annuity or draw down (taking your pension as and when you need it), you can assess that nearer the time.

And yes, you can name your Dc as the beneficiary of your pension. If you die and it is paid to them before you reach 75 it is paid tax free. If you are over 75 it will be paid to your beneficiary but taxed.

Pensions of a deceased person are now (from 2027) counted as part of the estate so could be liable for inheritance tax if the whole estate (including the main residence left to Dc) is worth more than £500k.

Thank you so much!

yes all private companies. I think I must have six at least! So terms of each don’t state annuity or drawdown, that is a choice I make when retire? I really going to try to save as much as I can in pensions going forward.

this post was really helpful 💐

This guy on YouTube has a LOT of valuable advice. This is just one of his videos on pensions, but you might want to check out his others.

You can consolidate them all into one new pension. Probably with better rates and lower fees than old accounts.

A pension advisor can do this for you. They can Find a fund that suits you, and get all the old pensions put the same pot.

Then in due course you can discuss all your options: whether to take a lump sum out 10 years before your state retirement age, whether to take an annuity or ‘draw down’… or a mixture of the two.

I recently read about Rebel Finance school on here. Course of free sessions on all things financial which happened back in June but all are on YouTube. There’s a Facebook page too. Super easy to follow and I think will help you feel more in control or at least have a plan for a plan. I totally recommend