What to do with a small pension

[Maxf]

I'd completely forgotten about a very small pension I started when I was 18 until I got a letter from HSBC telling me it has risen to the princly sum of £14k. I havent paid in for years (I'm 33 now).

Is there anything I can do with this cash? Can I transfer it into another pension (SIPP?) where I can invest the cash myself rather than trust the provider?

[Tiggsy]

yes.


your pension, put it where you want. Cant have it as cash but you can transfer it easy enough. (check on any penalties to move first ...and things like guaranteed annuity rates etc that may apply...or get an IFA on it - if you can find one that will look at such a small fund)

[Four Cofffee]

I read somewhere that small pensions under a certain value (and I had £20k in my head) could be taken as cash in a lump sum at retirement.

[Maxf]

Thanks guys. As I still have at least 32 years until retirement I'd like to try and grow the money into something a little more useful, but HSBC dont seem to be doing much with it at all.

[AndyAudi]

Four Cofffee said:

I read somewhere that small pensions under a certain value (and I had £20k in my head) could be taken as cash in a lump sum at retirement.

I looked at this as I'd a couple of small ones, however there are rules and if you have other pensions taking you above a certain value it is not an option. (or else we'd all be investing in lots of small pensions!)

[Beardy10]

You can definitely transfer it into a SIPP.....as far as I know there is no minimum amount.

[Tiggsy]

18k one assumes? (1% of th LTA)

[Kudos]

I did read somewhere recently (think was in my own pension magazine) that assuming a few averages, a 33yr old with £10K pot, making no further contributions could have a final value of c£100k.

Buys a ballpark annuity of £6500 I believe in todays money.

May be worth leaving in a decent pension

[Mattt]

Yeah, assuming c. 7% annual return (and no fees) that's about right for a 65yr old.

[Maxf]

Kudos said:

I did read somewhere recently (think was in my own pension magazine) that assuming a few averages, a 33yr old with £10K pot, making no further contributions could have a final value of c£100k.

Buys a ballpark annuity of £6500 I believe in todays money.

May be worth leaving in a decent pension

This isn't part of my pension planning really, and baring in mind the amount paid in was around £11k until perhaps 2003, the following 7 years 'growth' haven't set the world on fire, hence thinking about chopping it into something else.

The statement I received included the period of recent strong growth, which should have countered the big drops we've seen (partially at least) unless the provider invested heavily in banks in mid 2008 then converted to cash in mid 2009. Maybe they did!