Frequently Asked Questions


Am I eligible for a free report?

If you are over 55 and you have a pension that you are not currently in receipt of, you are eligible to take a tax free cash lump sum from your fund as well as income and or additional lump sums although the payments are liable to income tax deduction. If your pension is with a current employer this is not a good idea as you would have to opt out of the scheme and therefore losing future employer contributions.

Am I under any obligation?

No, at PensionLite we believe that everyone should have access to specialist pension advice without concerns about obligation or cost. Consequently, all of our clients have the opportunity to receive an independent, no obligation, pension review and recommendation report so they can best consider their options from a position of knowledge, in their own time and certainly well before any decisions are made.

If you choose not to follow our advice there are no charges or obligations.

Are the recommendations really Free?

Yes. Whatever the outcome of our advice the recommendations are completely free. You only pay for advice you accept.

If we do recommend that a transaction takes place we will clearly state this in your report, along with what the specific costs of following our advice will be.

You can also choose how you pay for that advice.

If you do not accept our advice and recommendations then there is absolutely nothing to pay.

Will you compare ALL Pensions?

Yes, in a structured way. Once we understand your needs, circumstances and aspirations we will firstly review your existing pension arrangements to see what options you have and also what benefits you have accrued. We feel it is better to check what you have before considering alternatives. It is important then to consider what you are expecting over the long term, what involvement you wish to have in managing your pension on a day to day basis and also what your attitude to investment risk is.

Whilst there is plenty of press comment about high pension charges there is little about poor investment performance. Despite this a successful plan is one which combines good investment returns with competitive charging. Comparing pensions based on charging is a naïve way of assessment and equally choosing a good investment performance without considering the charges or volatility is not sensible.

Stakeholders, Personal Pensions, SIPPs, Wraps and Platform managed pensions all have features which may suit you. So, as we complete our analysis you and your needs are key to the outcome. We will compare charges, investment facilities, fund choices and performance. We will check your attitude to investment risk and research where in the world your pension should be invested and in what proportion. We then research the best performing funds in each area, comparing performance over a reasonable period of time. Any funds selected as most appropriate will then be assessed for consistency, checked for volatility and rated to benchmark quality, stability and suitability.

We will then make you a recommendation as to a course of action or not. In short, yes we do compare ALL pensions.

Is Pension Review right for me?

It is vital that your pension suits your needs and circumstances and sometimes your pension needs to change for this to be the case.

Personal circumstances change all the time and so do pension charges and providers’ trading and service arrangements. Many personal pensions and stakeholders were sold in the 80s and 90s by sales teams that don’t even exist anymore. This makes it very unlikely that you will have had regular reviews of your pension plan.

Excessive charges are applied to many older pension plans so comparison and review is essential. You need a pension fund that reflects your attitude to risk and an old fund will probably not match that anymore.

Furthermore, if your pension is with companies such as Windsor Life, Phoenix or Capita, it is very possible that they will no longer be the firm you purchased your pension from in the first place.

A pension review is also wise if you have changed jobs, to make sure that it is suitable based on your new circumstances.

Here at PensionLite we can offer you a no obligation, independent review of your pension and provide you with a full report to explain the state of your pension and how it could be improved. There are no up-front fees to pay, you only pay for advice you accept!

You are free to ignore our advice but at least you will have the peace of mind that comes with the knowledge of what your pension is giving you. Alternatively it might make your realise that you can dramatically improve your situation and your future financial security.

How can I secure my income long term?

To ensure your income lasts your lifetime there are a number of strategies to consider. However, the simple fact is that one has to learn to live within a budget because if the cash you spend exceeds the income and or growth you receive from your funds your income potential reduces and if left unchecked over time will simply disappear altogether.

You need to review the income/growth and your expenditure regularly and adjust accordingly.

The other main consideration is income tax and so where and how you invest your funds can be worth another 20% or 40% of income if received tax free and or by using your personal allowances fully and this is something we will discuss with you.

You can mix and match your investment options so for instance using some of your funds to purchase a short term or reviewable annuity may be worth considering and provide an element of security that direct investment may not.

Your personal attitude to investment risk is something to review regularly as it can be adjusted in line with your circumstances or market conditions very quickly.

Pensionlite provide a regular investment review service in 3 different ways so you can do this in a way that suits you and your lifestyle. We provide an on-line review facility via our clients secure web site, you can chose to review in a paper format or you can ask us to update things regularly and tell you when things have occurred by post or e mail.

Most Pensionlite clients also have access to an on-line 24/7 valuation service so you can be in touch and update from anywhere in the world as long as you have either an internet connection or a telephone.

Is taking a lump sum compulsory?

The simple answer is no but please seek qualified advice before making any decisions at this could work against you. It is possible under Pension Freedom rules to receive a regular income made up in part of tax free cash if you do not want to take a lump sum.

How much can I receive from my pension?

Under the new Pension Freedom rules the amount you can take from your pension pot is only restricted by how much you have. A proportion of your fund, usually 25%, can be taken tax free but any other drawings are chargeable for income tax.

The freedom to access your pension pot is an exciting opportunity but you should remember that the primary purpose of your pension is to support you in later life. You should, before you decide what to do, think about your future finances as well as any short term needs. We can help you decide.

Can I still contribute to a pension fund?

In simple terms the answer is yes but if you use the full Pension Freedom rules and are accessing money under Flexi Access rules the maximum you can contribute in a tax year will be restricted to £10,000

These rules can be difficult to understand so please seek qualified advice before assuming that this or any other restrictions will or will not apply to you.

What are the drawbacks of pension release/drawdown?

If you take a sum of your pension before you plan to retire there will be a smaller pot of money to provide you with an income, of some form, when needed.

Accessing funds from your pension once you reach age 55 or above, but before retiring, is very attractive and for some irresistible. We are after all human beings and the temptation to spend is all around us.

As a word of warning please remember that other than your tax free cash entitlement and any other pension drawings are classed by HMRC are earned income so liable to income tax at your highest rate of tax in the tax year you take the withdrawal.

To put this another way, if you are looking to make a purchase using funds from your pension please take into account the tax you may pay. If you are liable for 20% tax deduction then in reality what you are purchasing is in real terms 20% more expensive than the asking price.

Taking cash from a pension is not right for everyone.

Yes of course there are emergencies in life that we have to deal with but think carefully before making any decisions and seek qualified advice from an independent financial adviser who is suitably qualified to give it.

What happens to my pension if I die?

If you die before age 75 your spouse (or any nominated beneficiaries) can receive your fund value as a lump sum or income, tax free. If you die after 75 the fund can still be passed on but withdrawals/lump sums will be subject to income tax. If you purchase an annuity, the income will stop when you die unless you build in death benefits from the start, like a spouse’s pension or guaranteed minimum payment period.
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