Too many small pensions

[Wullie10]

I have a .small personal pension which I took a smallish lump sum at 55 , then left the rest invested. Now almost 60 I have a choice soon what to do with two other Royal Mail pensions., the 60 and 65. Then If I continue working with Royal Mail they'll be another to add called a cdc. If I leave Royal Mail I'd probably have an option of another work place pension. Is it worth continuing with all these tiny pensions considering the paperwork and the rules involved. Could I continue to add to my personal pension now I've taking a lump sum ? I feel its best to say at 60 that's enough. Take what I have and put any savings into an ISA. Its a minefield having bits and bobs all over. Once I take my personal pension as drawdown no doubt they'll be another amount of paper work to fill in.

[RobertT]

I have a .small personal pension which I took a smallish lump sum at 55 , then left the rest invested. Now almost 60 I have a choice soon what to do with two other Royal Mail pensions., the 60 and 65.

There's no choice with the NRA60 – take it at 60, as there's no benefit in not doing so!

Then If I continue working with Royal Mail they'll be another to add called a cdc. If I leave Royal Mail I'd probably have an option of another work place pension. Is it worth continuing with all these tiny pensions considering the paperwork and the rules involved.

All workplace pensions benefit from employer contributions and tax relief, plus some also benefit from salary sacrifice, which RM call PSE.
It's generally not a good idea to refuse free money, particularly on the trivial grounds of there being too much paperwork.

Could I continue to add to my personal pension now I've taking a lump sum ?

Yes.
You can pay as much as you want into as many pensions as you want to have and benefit from tax relief. Up to a maximum of how much you earn, or £40k, whichever is lower.

I feel its best to say at 60 that's enough. Take what I have and put any savings into an ISA. Its a minefield having bits and bobs all over. Once I take my personal pension as drawdown no doubt they'll be another amount of paper work to fill in.

It's better to have a reasonable amount of pension tucked away, that'll enable you to at least semi retire at a fairly young age, than not and have to work well into your 60's or even later.
Personally, I'd say having to fill in a bit of paperwork is a small price to pay.

[Wullie10]

I have a .small personal pension which I took a smallish lump sum at 55 , then left the rest invested. Now almost 60 I have a choice soon what to do with two other Royal Mail pensions., the 60 and 65.

There's no choice with the NRA60 – take it at 60, as there's no benefit in not doing so!

Then If I continue working with Royal Mail they'll be another to add called a cdc. If I leave Royal Mail I'd probably have an option of another work place pension. Is it worth continuing with all these tiny pensions considering the paperwork and the rules involved.

All workplace pensions benefit from employer contributions and tax relief, plus some also benefit from salary sacrifice, which RM call PSE.
It's generally not a good idea to refuse free money, particularly on the trivial grounds of there being too much paperwork.

Could I continue to add to my personal pension now I've taking a lump sum ?

Yes.
You can pay as much as you want into as many pensions as you want to have and benefit from tax relief. Up to a maximum of how much you earn, or £40k, whichever is lower.

I feel its best to say at 60 that's enough. Take what I have and put any savings into an ISA. Its a minefield having bits and bobs all over. Once I take my personal pension as drawdown no doubt they'll be another amount of paper work to fill in.

It's better to have a reasonable amount of pension tucked away, that'll enable you to at least semi retire at a fairly young age, than not and have to work well into your 60's or even later.
Personally, I'd say having to fill in a bit of paperwork is a small price to pay.

Thanks Robert. You probably enjoy a extra bit of paperwork as your understanding of pensions is second to none.. I can't really understand how a 60 to 65 pension would produce anything worthwhile at all even with employer contribution. Would be a nightmare for families if you were unfortunately to drop dead. To clear up a point. Once you've taken any tax free lump sum you can still contribute in to as many pensions as you wish as ling as the total contributions do not exceed 40k pa or your earnings in the year ? So a AVC lump sum could be paid into a private pension ? This has been discussed elsewhere I'll have to check. Thanks..

[RobertT]

Thanks Robert. You probably enjoy a extra bit of paperwork as your understanding of pensions is second to none.. I can't really understand how a 60 to 65 pension would produce anything worthwhile at all even with employer contribution.

A full timer on a basic of £467 per week and in the RMDCP with Scottish Widows, would have a total of about £20k in contributions going in over the course of 5 years. It would only cost them around £4,900.
Plus investment growth.

In the new CDC scheme, the same employee would accrue a guaranteed lump sum of around £4,500 and a pension(which can go up and down) of £1,500 per year, over the same 5 year period. But with an NRA of 67. The net cost would be the same at around £4,900.

The general rule of pensions, is always join your company scheme and at least pay in whatever it takes to get the maximum employer contributions.
It's part of your overall pay package and opting out is akin to taking a pay cut!

Would be a nightmare for families if you were unfortunately to drop dead.

There's a lady on my walk who's husband has recently died, and she told me she's had to fill in 42 pages of forms to be able to get her spouses benefits from his company pension.
She probably wouldn't be able to afford to pay her bills without that pension!

The amounts I quoted above aren't massive, but they can make a difference if your other pension income isn't going to be enough, or to a deceased relative who's just lost the families main bread winner.

Unfortunately, that paperwork will be a matter of necessity for many!

Personally I think you need to see your pension provision as a jigsaw, which you slowly put together over the course of your working life and from all the jobs you have. The earlier you start and the more 'free money' you take advantage of, the better and potentially earlier retirement you're likely to have.

To clear up a point. Once you've taken any tax free lump sum you can still contribute in to as many pensions as you wish as ling as the total contributions do not exceed 40k pa or your earnings in the year ? So a AVC lump sum could be paid into a private pension ? This has been discussed elsewhere I'll have to check. Thanks..

You're not really supposed to put tax free cash back into a pension, as it's classed as pension recycling. You'd be gaining tax relief twice!

If you do that in one go, it's likely to ring alarm bells with the taxman. So it's best to drip feed it over a number of years.