Should I merge this little pension?
Discussion
I have an Aviva pension that hasn't been paid into for 24 years with a transfer value of £23k. My main pension is with Standard Life, and though far from substantial, does get paid into monthly. Cashing in the Aviva writes 25% off straight away in tax I believe, and I don't need the cash. It also isn't really worth keeping for retirement as far as I can tell. Is it best to simply transfer it into the Standard Life (with profits) pot as a top up at this stage? Plan retirement date is 2027.
Happy Jim said:
Will it get better returns (%) if moved?
Will you save on charges?
Or just leave it and burn through that pot first in ‘27 ;-)
I think it's free to move, but whether I'd get a better return on one big pot, I don't know.Will you save on charges?
Or just leave it and burn through that pot first in ‘27 ;-)
I won't be retiring in 27 unfortunately. One of my retirement income streams has just been screwed by Dover District Council adding 100% premium to my second home council tax. I was going to do Air B n B to cover the upkeep costs that will now be around 6k per annum. After all the hassle and cleaning etc for B&B and tax, I'd just be working for DDC.
Lord Flashheart said:
I have an Aviva pension that hasn't been paid into for 24 years with a transfer value of £23k. My main pension is with Standard Life, and though far from substantial, does get paid into monthly. Cashing in the Aviva writes 25% off straight away in tax I believe, and I don't need the cash. It also isn't really worth keeping for retirement as far as I can tell. Is it best to simply transfer it into the Standard Life (with profits) pot as a top up at this stage? Plan retirement date is 2027.
In a similar situation to yours, I merged a couple of older pensions together into one. I actually ended up moving a larger value old one (30 years old) into a smaller one because the smaller one was more flexible and had lower charges. If your Aviva pension is 24 years old, you might find similar.Look into something called "Trivial Pension Commutation" - or something close to that.
You can cash in small pots with zero tax - or at least that was my understanding when I looked at it. The limit is £30K, but it might be 3 pots of up to £10K rather than a single pot of £30K.
Worth a look anyway. If you can get the money out without paying tax, then whack it into an ISA.
You can cash in small pots with zero tax - or at least that was my understanding when I looked at it. The limit is £30K, but it might be 3 pots of up to £10K rather than a single pot of £30K.
Worth a look anyway. If you can get the money out without paying tax, then whack it into an ISA.
omniflow said:
Look into something called "Trivial Pension Commutation" - or something close to that.
You can cash in small pots with zero tax - or at least that was my understanding when I looked at it. The limit is £30K, but it might be 3 pots of up to £10K rather than a single pot of £30K.
Worth a look anyway. If you can get the money out without paying tax, then whack it into an ISA.
Iirc it’s a £10k max per pot and a max of 3 pots. You can cash in small pots with zero tax - or at least that was my understanding when I looked at it. The limit is £30K, but it might be 3 pots of up to £10K rather than a single pot of £30K.
Worth a look anyway. If you can get the money out without paying tax, then whack it into an ISA.
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