Pensions - more advice please?

[SouthWestmom]

Ok im too young to get help from the pensions advisory service and too old to pay an IFA with too little spare to make it worthwhile:

Im 45

I have a work pension with about 1500 in it. Work pay in and say they can't pay to anything else. I pay nothing.

I have a private pension with 8500 in it. I pay a crap £30 a month.

I want to combine them but ideally would have put the work one (no exit fees) in and have work pay into my private one. Then I would increase payments myself.

The other way round leaves me vulnerable to job loss.

Why are you not paying in to your works pension. Work pensions are usually better than private ones as employer matches your contributions.

What Viv said.

I don't know really. Just was battling with debt and weird kid stuff and things and pensions got ignored.

It's just now I'm focussing on it all.

Is there any reason you can’t start paying into your work one now rather than pay into the private one? Do you know what the investment and admin fees are on the work one compared to the private one?

I don’t understand your comment about being vulnerable to job loss. Could you explain?

Seriously, anything is better than nothing so stop beating yourself up about it. What's important is that you have started to focus on it now which is better late than never. Personally, I would contribute into the more generous work pension over the personal pension.

There’s also no vulnerability if you leave - you’ll always have that pension.

And why would you want them combined? I can see how having 5 different pots could be confusing but one work pension and one private one sounds alright. I’ve got that set up out of choice. I’m going to get a good annuity with the employer pension (it’s one of the public sector schemes). I will use the private one for drawdowns. So it’s quite a good set up.

Mint - I work in a field where people are made redundant or move on a lot. So I worry that by moving to the work pension id have to stop if I left.

Jo - there just isn't enough money to make two separate ones work.

*There just isn't enough money to make two separate ones work."

How so? Adding them together doesn't do anything different. A fund of £1k and one of £3k adds up to £4k whether they're is a single pot or two different ones. Presumably fees are a percentage not fixed, so you wouldn't save on fees by combining them.

If you leave your job, the money will still be there - it's not vulnerable to anything. You would presumably get another job, and that employer would pay into their scheme for you. This is completely normal - employers pay in to their own scheme, not one that you pick.

The Money Advice Service is presumably what you're after rather than the Pensions Advisory Service. www.moneyadviceservice.org.uk/en/categories/pensions-and-retirement

Thanks Lords that's really helpful.

I think it's because of the predictions. So about £200 a year form the private one and a tiny amount from the work one.

If I combine them I would get a single larger payout and it solves the problem of who to pay to.

I like black and white stuff a bit.

You’ll 45 and given the state of your pensions, you’ll probably work for another 20+ years so plenty of time to build up real pots.

I’d also not assume that getting an annuity is the best way forward. While it’s nice to have some of that security for life, they are very expensive to buy + might not be great for inheritance purposes.

If you’d rather not pay for professional advice, I’d also recommend some of the Financial Times publications (books) once you’ve got the basics from a place like Money Advice Service.

As others have said, there is no risk of you losing your workplace pension if you were made redundant. When you started a new job, you would be enrolled into their pension scheme and you could transfer over your old workplace pension if you wanted to.

The annual predictions are likely to be based on purchasing an annuity whereas in 20 years when you retire, very few people may buy annuities to give them income in retirement. I’d suggest that you read about drawdown in retirement. For the moment though, you should focus on building up a bigger pot. Check with your employer whether they will increase their contributions if you pay into your pension scheme at work.

Thank you, I feel a lot more confident that I can turn this around now.
I was worried that paying for advice when I can't afford a big increase in contributions was pointless so will look at the suggested reading. It's a lot less hopeless !