Pension -

[WMDinthekitchen]

I have been saving in a private pension for the past 12 years. In addition, I have a non-contributory pension through my employment which has also been paid into for 12 years.

I am likely to be made redundant in the next year or so. I intend to try to find another job but if I cannot, I will retire. I know that in order to get a pension I would have to use the pension funds to buy an annuity.

Can I not, however,r, do something else? For e.g. the funds, if added together, would be enough to buy a flat or small house which I could let out, still retaining the property for sale at some stage in the future. Would that be possible or am I locked into using the funds to generate a pension via an annuity?

When my mother retired she had a public sector pension, a state pension and a private pension pot which generated a lump sum. She used the lump sum for home improvements

Yes you are restrcted to buying an annuity. Depending on the pension product, some allow you to cash them in but you get back much less than the headline annuity lump sum because the benefit of pension contributions being pre-tax gets rescinded. (the non-contributory one is unlikely to allow even this). annuity rates are terrible at the moment so depending on your circumstances it could be wise to put off buying an annuity, but you can't make decisions like this without proper (paid-for) independent financial advice which is tailored to your specific circumstances - mumsnet advice is not enough!

Thank you xkcd, I suspected as much. I do have a IFA but I always like to be prepared before I go to see her. One hopes these people provide the best advice for the client but I am a cynic. She has to take her cut after all, and if it's a choice between me getting a few ££ more and her getting a bigger commission...

IFAs are of course free to flame me or confirm as much. I tend to the opinion that unless the IFA is, for e.g., a family member then the advice is not truly independent.

Some IFAs, that's true. I am always very wary of any advice which I'm not paying full price for - if I'm not paying, then I am not the customer. Sometimes you can find one who will charge you a fixed fee for their services and agree that any commission due on any product you buy after their advice will be chanelled to you rather than them - that way they are free to give you actually unbiased advice.

Choose a fixed fee IFA. You can own commercial property with your pension through a SIPP, but not residential property. I do do this, but it was expensive and complicated to set up, but I had 23 years to 65 at that point so long time to recoup those costs.

annuities are an utter rip off at the moment
you need to be retired 38 years just to break even on what you paid into the fund

I have asked the powers that be (and had a deafening silence in response) whether there is ANYBODY in the country living solely on the income from a DC pension scheme

I suspect there isn't
and never will be