Drunken Bungle Whore

Sorry if this has been done before - but I know **** all about pensions and could benefit from some pointers!

Should I be contracted in or out right now? No ****** will give me any advice cos everyone says they're not allowed to! I was contracted out about 10 years ago but had some stuff from my pension company saying I may need to be back in now. Why? In plain and (very) simple English - what's the difference? What are the deciding factors?

I'm considering joining my company scheme but would like to transfer 2 other private pensions into it - long story - (my new years resolution is to sort my pensions nightmare) - but no one seems able to make this easy for me! Are there any reliable idiots guides out there?

Any help much appreciated!

OllyK

When I took my pension out I contracted out. My FA said the norm is contract back in again shortly before retirement age (about 5 years).

This may all have changed since then though!

Peanuts

iTrader: (15)

unfortunately it seems that all the idiots guides werent written for idiots, rather written by idiots.
to say its a minefield is an understatement.

a company pension scheme is a complete gamble unless its a final salary job.
if I were cynical, I would suggest there'd be more of a payout by placing a £50 stake on all 50-1 shots (or bigger) at newmarket for a year....

Robert Rosario

a company pension scheme is a complete gamble unless its a final salary job.
if I were cynical, I would suggest there'd be more of a payout by placing a £50 stake on all 50-1 shots (or bigger) at newmarket for a year....[/QUOTE]
Classic.

Tiggs, any comment?

MattW

However if your company make a contribution, it is likely that that would be the best choice.

Think long and hard (and take professional advice) about transferring your old schemes, you may be hit by charges that erode the value.

fast bloke

the main problem with pension advice is that Mr Brown decided that it should be available to all and that the advisor should make fek all from giving the advice. Suddenly 300 billion pension advisors went off to look for jobs that they would get paid for . then, when no-one was looking, he bunged a load of taxes onto all the pension schemes (except MP ones.... and judges ones, cos they caught on and threatened to tell his mommy or something) - If it was me I would blow it all now in case I die

vindaloo

Disclaimer: Not exactly an expert.

IMO if you have a final salary pension scheme then it'd be better to be 'in' rather than 'out'. That said, my own will shortly be undergoing a change where they ask me for more money to maintain the same benefits.

At the moment we have more disposable income due to low interest rates etc. In short, we should be propping up our pensions and investments with the surplus rather than spending it on booze, **** and toys.

Also IMO: Prop up any pension by investing in ISAs etc. as an independent source of savings.

J.

Tiggs

as FB says:

Pensions = red tape and no money = no advice from anyone other than a retard that cant make a living elsewhere unless you want advice on a 500 man scheme.

spend it on crap and have laugh instead (thats free advice )

T

Drunken Bungle Whore

Thanks for trying guys - looks like there's no real answers.

That's the problem Matt - no bugger will give me any advice!

We're getting bombarded with 'Pension Timebomb' frighteners - but there's no one around to give you any decent advice about what you should do - typical!

johnfelstead

www.fsa.gov.uk/pubs/public/pl06.pdf

RichardSimpson2004

http://www.fool.co.uk/pensions/pensions.htm - links at the bottom with some basics and I think State Second Pension is what your after re contracting out

Tentenths

It is now generally accepted that, on balance, *most* people will *probably* be better off contracting back in - however this is subject to all sorts of ifs and buts.

This is based on current expectations as to the future direction of invesment returns, annuity rates and government rebates etc. If, in reality, some/all of these prove to be higher then, with the benefit of hindsight, you may wish you hadn't contracted back in. But, if this should happen you won't be alone - the Consumer's Assocation et al will then whip up campaign and you'll get some free money.

scoob_babe

I'm back in a company final based salary scheme now, after being in rather crappy mony purchase company schemes. I took the choice to be contracted out of SERPS then. If I understand correctly, I don't need to do anything because I'm part of a company scheme?

Drunken Bungle Whore

No idea I'm afraid SB. I just managed to get some advice from our in house pensions expert - who couldn't give me advice - but he could tell me that his wife - who is the same age as me - took some proper advice and was advised to contract back in. That'll do for me!

johnfelstead

the mind boggles.

Tentenths

You are very, very fortunate - a vast majority of FS schemes are now closed to new members. Chances are that the FS scheme may well be contracted out anyway (but on a different basis to what you had before). If you're unsure consult your Members' Guide and/or talk to your Pensions Department.

scoob_babe

Tentenths - tell me about it!! The final salary scheme was closed to new staff at the 1st October 2004 so you had to be employed before the 1st June 04 to get in. I scraped back in by 2 months!!!

GM

If you're in an occupational money purchase scheme you probably shouldn't have been contracted out since the rebates were reduced a few years ago.

If you're in a personal pension scheme it will have higher rebates than an occupational one - but you'll find it pretty hard to find someone to recommend that you should still be contracted out.

And if you're in a final salary occupational scheme you won't have the choce to contract back in anyway.