when i was at my last company i started a private pension plan which
they offered, i only paid in about 3 months worth at the minimum rate
then i stopped paying into it
it is a standard life one
when i stopped paying in i decided i was going to make my pension via
other ways (property) i am still of this view and do not want a
pension other than the required state one
i keep getting mail from standard life about opting in and opting out
and a statement every year
is there any way i can get rid of this plan? i just dont want it and
would happily cash it in for a lot less than its value, but is this
You can't access the cash within a Personal Pension (or stakeholder
pension) until you are at least 50 years old - which will rise to 55 by
You can transfer it to another pension, but if you are relatively
young, you would be able to get your hands on this for some time. The
point is that you have been given tax relief on the contributions, so
the funds must be used to provide pension benefits.
Some Occupational Schemes provide a return of premiums (minus tax) if
you have been a member for less than two years, but I doubt if your
scheme falls into this category.
Financial Calculators & Tools
Do you care to share a bit about the plan you have for buying property
to fund your retirement? Do you have any specific targets (x times
income, Y properties) that you have calculated to fund the retirement?
I am not really asking about the merits of property as an alternative
to a pension. Just how you thought through the numbers to arrive at a
It might be useful to start a separate thread but I will let you make
plan is straightforward own 2 properties one to live in and one to rent
out,already some of the way there cant see it being a problem
might sound silly but i just dont want to keep receiving mail from
standard life regarding this pension plan that has hardly anything in
id rather forget about the whole thing, this does not seem possible ? /
? ? ?
I think you will need more than 1 other property (1 beyond your
residence) to make a meaningful pension alternative. The math just does
not support owning only 2 unless you have an extremely low income need
or you have lots of other pension income.
I would have expected you to take you income presently (assuming your
present lifestyle is all you need), multiply it by 20 and that would be
the amount of total value you need in property beyond your home. The
magic about the 20 is it assumes a 5% gross yield from the property in
terms of rental income. No debt on the property. No real budget for
repairs. Equity in the property is trapped or otherwise not something
There are other ways to run the math. You could build a portfolio which
you sell at retirement. Then the value of the property is more
important than the income the property might produce. You would need to
take the profits, pay the tax and then do something to generate an
income. Or you could just live off the principal if you think you can
time it right.
Why do you think one home to live and one to produce an income will
largely replace the need for a pension? I am not a big believe in
pensions so I am not trying to make that case. Just that you likely
need more than 1 extra property.
Remember that if you are treating rental properties as a business, then
the costs of running this business could be up to 40% of your rental
income (i.e. cost of acquiring property, repairs, periods where the
property remains unlet, costs of a letting agent if you go down that
route). Also, interest rates may change if you have a mortgage on a
It is not without risks.
Personally, I just could'nt be bothered with this at the moment, and I
think to some degree that market for buy-to-let is already getting a
bit saturated and oversold. Getting in five years ago was OK, but could
be a bit iffy now.
I'd rather stick money in Commercial Property funds than hold property
Just my opinion - but back to your First point - you are probably stuck
with your Standard Life pension.
Good point about concerning budgeting for running costs. 40% is a
reasonable target when you really look into all the running costs.
(ignoring the cost of acquisition).
BTL (Buy To Let) in the residential sector is a bit odd in that there
really was no sector for 25 years ending in 1996. Eviction and lending
changes brought the BTL market to life in 1996. Hence I would speculate
that the BTL market is looking for a level that is sustainable rather
than saying it is saturated. As there is still a housing shortage and a
certain percentage of the population will be renters (temporary life
requirements or more of a long term lifestyle) there is room for
further BTL expansion. The style of BTL property and the locations are
important so there can be a glut in 2 bedroom city-center flats while
still a shortage of BTL housing overall.