Fletch
Striker
i was under impression that most folk now do drawdown and avoid annuity
Pension rip offs
- Thread starter Boldoneye
- Start date
i was under impression that most folk now do drawdown and avoid annuity
A lot do, because annuity rates are low, but it needs to be taken on an individual basis. Some people might have guaranteed annuity rates which are high. Some people might be ultra cautious & want the guaranteed income.
You’ve also go to think if it’s in flexi-drawdown, it should be invested so the pot works & lasts longer. People like the OP doesn’t want to pay an expert to do that.
Fletch
Striker
but for example if you're paying 0.5% pa to the pension provider , once you take some out into drawdown that fee should surely remain the same ?
Did you ever use Pension Bee? I am in a similar position with several funds from several employers and considering combining them, although I have a contracted out element which appears to complicate this a little.
If you did use them, or if anyone else has, are they any good?
Problem is that most pension funds are managed by slick haired spivs ( whether public or private ) and they don't a flying f9rt if the funds tank..its not their money.
You are better off putting away money into an account you own every week.
Maybe use some to buy a second property or invest in blue chip shares. It all takes time but the GFC ( as in previous global meltdowns ) should teach people that the people at the top of financial trees are little better than slot machine addicts
Some Random Guy
Striker
If you have the means to do that, great.
cosmicchris00
Striker
I'm another one in this situation.
The choices are fairly bewildering as I know the square root of chuff all about pension consolidation but have 3 to figure out what to do with them all.
Tuono
Winger
I transferred a couple of old pensions into PensionBee in March this year. Just checked a minute ago and they have increased 5.7% since March ... but a few weeks ago they were down to a 0.5% increase. Up and down like Diana's knickers at the moment they are.
I like how with PensionBee you can transfer funds and increase or decrease your contributions in seconds. It's handy being able to look at exactly how your funds are performing and adjust them accordingly.
Billy Fish
Striker
I'm in the same place and have recently spoken to an IFA and arranged to put a few of my pots with them, equivalent to about a third of the overall portfolio but hate paying the fees for it!
However, since doing it I've seen videos on YouTube by this lad.
I think going forward over the next few years I'll transfer other pots to Vanguard or similar and leave the initial ones with the IFA and see how each perform. As part of my fee with the IFA I get regular updates and reviews so whatever advice I get from them I can use to review the Vanguard pot but without the IFA getting their high percentage slice off that pot as well. I'll see how the two pots perform against each other before deciding on which one to drop both into before I retire.
For young'uns just starting out the YouTube lad puts up a great example.
A lass starts putting money into a pension at twenty, she puts in say £5000 a year with her contributions, employer and tax contributions. She does this for ten years then stops and has contributions of £50k. A lad starts at 30 and also puts in £5k a year but does it until he's 65 and has contributions of £175k overall. When the final two pots are compared the lass has far more in hers despite contributing significantly less just because she started early and the compound interest on her pot has longer to grow.
42
Striker
Currently vanguard don't do the drawdown of the pension, so upon retirement you'd need to transfer it to someone else (however, I suspect by the time you retire they probably will as they've only recently started doing pensions)
Fletch
Striker
think vanguard must do drawdown now ?
www.vanguardinvestor.co.uk
Withdrawing your pension money | Vanguard UK Investor
When thinking about retirement, you want to make the right decision to fund the life you want. Find out about taking money from your pension here.
Billy Fish
Striker
I'm sure when I had a quick read through their info on line they do a drawdown service.
Should have read the next post before posting mine! They do seem to provide an excellent and low fee service.think vanguard must do drawdown now ?
Withdrawing your pension money | Vanguard UK Investor
When thinking about retirement, you want to make the right decision to fund the life you want. Find out about taking money from your pension here.
They don't offer an annuity service, but that's no real grief.
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mickb2112
Striker
And you wonder why the fund managers and financiers always manage to give themselves large bonuses virtually every year. Where has all the money gone??
D
Deleted member 30053
Guest
Wouldn’t use them to be honest. You are best off using a firm that allows you to do what they do but then also provides on-going advice and support to you when you need it. Good firms will offer full advice, hybrid advice and robo advice offerings to cater for the needs of all clients in an ever changing tech-focused world.
What’s the nicest way to say “what a load of shite” mate?
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Billy Fish
Striker
What's your thoughts on the Vanguard offerings Shirley?
WASTID
Striker
Compound interest is the 8th wonder of the world!
Read the Tony Robbins book Unshakable earlier this year. One of the big points it makes, is that management fees are generally costing you a huge amount of your future wealth. Funds that take more than 1% are making a huge dent because of the impact from compound interest.
Basically, the book can be summed up as "invest into Index trackers with a low management charge as quick and early as you can then watch them snowball over time".
D
Deleted member 30053
Guest
They are a really good fund manager to be fair. They seem to be the go to fund manager for self investors a lot of the time as well as investors are attracted in the main to their low cost passive offerings.
Horace Cope
Winger
I've moved companies a lot in the past and I used pension bee to combine all my old pensions. Really quick and straight forward. They did all the hard work. The app is brilliant but their fees may be slightly higher but for me it's worth it to tie up all those pensions. Got to be better pooled together than on their own
CraigyLee
Striker
can you move them from there easily enough?
D
Deleted member 30053
Guest
The main danger with Pension Bee is you don’t know what you are giving up if you just blindly transfer them to “consolidate”. You are taking on the responsibility yourself. If you are savvy enough to understand the difference in charges, lifestyling strategies used within some of your previous workplace pensions, guaranteed annuity rates, fund performance etc then fair enough. I’ve also seen some crackerjacks who’ve got CETV’s from their final salary plans and tried to move that into Pension Bee without advice only to be surprised when they are told they can’t.
That’s usually why it’s better to seek advice. The main reason people don’t is they are reticent to pay for it. There was a recent study by the FCA showing how much better off clients were who took advice vs those that didn’t and the results are quite staggering.
Many people just take the annuity on offer because they don’t want to pay an adviser for example. A significant number of people don’t understand their workplace arrangement derisks as they get older. This massively restricts growth and is designed to really purchase an annuity which of course hardly anyone does now. It’s a minefield if you don’t know what you invest in, why you invest that way and how it’s going to allow you to meet your goals and objectives.
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