Share this page:
Stay connected:
Welcome to the Citywire Money Forums, where members share investment ideas and discuss everything to do with their money.

You'll need to log in or set up an account to start new discussions or reply to existing ones. See you inside!



Drawdown providers
Roy Gallagher
Posted: 23 December 2012 12:45:46(UTC)

Joined: 23/12/2012(UTC)
Posts: 3

I will be retiring in March 2003 and I am looking for some guidance on setting up a capped drawdown with part of my pension pot.

I have three small money purchase pension pots with Sun Life Financial of Canada totalling approximately £79,000, which all have guaranteed annunities. I intend to take the 25% tax-free lump sum and the annunities on my retirement date.

I also have two pension pots with Equitable Life, one is approximately £99,834, which has a guaranteed GMP of £5,671 p.a., with a 50% pension to by wife when I die, this has no option of a tax-free lump sum due to the guarantee; and the other is a money purchase pension pot of approximately £34,388 from an AVC, I intend to take the 25% tax-free lump sum and use the remaining £25,791 as part of a capped drawdown.

I also have a money purchase pension pot of approximately £190,000 with Legal and General from which I intend to take 25% as a tax-free lump sum, leaving approximately £142,500, plus I will be including £25,791 from the Equitable Life money purchase pension to give me approximately £168,291, which I would like to use for a capped drawdown.

I have been looking around and it seems that you can't go direct to one of the companies that provide capped drawdowns without going through an adviser.

I would appreciate your advice on the best way forward.
Posted: 23 December 2012 23:17:25(UTC)

Joined: 18/06/2010(UTC)
Posts: 212

Thanks: 271 times
Was thanked: 222 time(s) in 112 post(s)
Assume you mean you will retire in March 2013.
I am no pensions expert so I can only relate to my own experiences.
I too had a small number of personal pensions (unit based with no GMP) which I ultimately combined into one pension fund and then finally transferred that into a Sippdeal e-Sipp.
I wrote to each pension administrator asking for a transfer value and then wrote to the provider I wanted to accept the transfer. Once I was down to one personal pension I then applied on-line for the transfer into Sippdeal. (Sippdeal arrange the transfer on your behalf providing it meets with their conditions).
The final transfer consisted of equity shares and cash.
In my case it was all very straightforward and I just wish I had done it so much earlier as it turned out that I was now hundreds of pounds a year better off. (Sippdeal do not charge any management fees during the Investment phase of my Sipp).
So in your case first of all it depends whether you are comfortable making your own investment decisions - ie choosing your own funds or equity shares in the Sipp plus the ongoing control and secondly are you are in normal good health. If - yes, yes - then perhaps it makes sense to get this moving as soon as possible as for me the benefits have materialised both during the investment phase and during the drawdown phase.
Suggest you start with the Sippdeal website, make sure you get familiar with how it all works make your own calculations and compare the benefits of Sipp versus annuity. Then have constructive discussions with you current pensions companies one by one and talk with your intended sipp provider and make the transfers only if you are convinced and then proceed one by one.
For me having one combined pension fund or Sipp is much preferrable to paying several lots of annual charges.
Perhaps other readers can comment on how to handle pension funds with GMP terms attached.

Roy Gallagher
Posted: 24 December 2012 05:30:56(UTC)

Joined: 23/12/2012(UTC)
Posts: 3

Hi John, thanks for your advice.

Just to clarify, yes I am retiring in March 2013.

Due to the guarantees on my pensions with Sun Life Financial of Canada I will not be moving them.

At the moment I still have not made any decision on where to move my GMP guaranteed pension with Equitable Life, they have supplied some figures from Canada Life.

I am looking for a capped drawdown with my Legal and General and the other Equitable Life pension pots of approximately £168,291 and would like some guidance on the best way to set this up without using an advisor.

Posted: 26 December 2012 10:04:23(UTC)

Joined: 05/01/2012(UTC)
Posts: 16

Thanks: 20 times
Was thanked: 8 time(s) in 3 post(s)

I have just moved my Select Sipp with Alliance to BestInvest Select Sipp. They have done all the paper work and pay any exit fees from Alliance, their annual fees are very competetive and they rebate trail commission. I have to make my own investment decisions but have done that for 20 years. I am in maximum drawdown and looking forward to drawing more when GAD rules change.I have never been through Financial advisor.

Hope this helps
Roy Gallagher
Posted: 26 December 2012 11:45:52(UTC)

Joined: 23/12/2012(UTC)
Posts: 3

Hi Eilidh,

Thanks for the information, will investigate using Bestivest. Thanks
+ Reply to discussion


Other markets