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You NEED to know these 3 ways to take FLEXI ACCESS DRAWDOWN!

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You NEED to know these 3 ways to take FLEXI ACCESS DRAWDOWN!
If you're looking to work with a Financial Planner for financial advice and determine if we would be a good fit for you, contact us today:
Website:
featherstonepa...
LinkedIn:
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Please note:
The information provided is based on the current understanding of the relevant legislation and regulations and may be subject to alteration as a result of changes in legislation or practice. Also it may not reflect the options available under a specific product which may not be as wide as legislations and regulations allow.
All references to taxation are based on my understanding of current taxation law and practice and may be affected by future changes in legislation and the individual circumstances.
This channel is for information and education purposes only. Any information or guidance given does not act as financial advice. Please consult a financial adviser if you are unsure in anyway.
Keep in mind that the value of your investments can go down as well as up, so you could get back less than you invest.
My aim is to provide education and guidance to help individuals understand pensions, investments and protection.
#pension #retirementplanning #financialplanninguk

Опубликовано:

23 авг 2024

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Комментарии : 64

@EdmundBaileyUK 2 года назад

Thanks for watching!! 🙏 Please let me know if you have any questions and let me know how you are planning to take your pension income inline with your tax position?!

@Vanosphere 6 месяцев назад

They make financial systems complicated on purpose to fleece you of your money. This is about the 6th video I've watched on pensions and I'm still completely baffled

@davidhughes6048 3 месяца назад

Could the problem rest with you, perhaps?

@Vanosphere 3 месяца назад

@@davidhughes6048 Partly yes, but are you trying to tell me it's not intentionally complicated.

@keithpearson7539 2 месяца назад

@@davidhughes6048 I think not!

@chrisf1600 5 месяцев назад

This was excellent, thank you. I've watched many videos on drawdown from the "top names" on YT and this is by far the best. Clear and concise, great job !

@EdmundBaileyUK 5 месяцев назад

Thanks! 🙏

@michaelb462 2 года назад

Thanks Edmund. I've only recently started looking at pension options as I still have a way to go and my focus is on building the pot. I wasn't aware that this was an option. Really appreciate your time & your videos are really clearly explained.

@EdmundBaileyUK 2 года назад

Thanks so much for the comment and kind words Michael!

@russjohnston3307 9 месяцев назад

Try getting a flexi drawdown today, you'll have more chance of experiencing space flight. Indemnity insurance stopped mine from happening.

@johnhopwood4633 5 месяцев назад

Excellent advice - and at realistic levels for everyman.

@EdmundBaileyUK 5 месяцев назад

Thanks John.

@shamps25 Год назад

Absolutely brilliant explanations, thank you

@timwills6584 2 года назад

Excellent... exactly what I needed to know and delivered in a clear and concise way. Extremely useful. Thanks!

@EdmundBaileyUK 2 года назад

Thanks so much Tim!! 🙏🙏 Really appreciate that!

@timwills6584 2 года назад

@@EdmundBaileyUK Best I've seen so far and really important to me right now. I'll keep a watch out for more. Thanks!!

@markevans1947 3 месяца назад

Great explanation, that has made things a little clearer. Thanks

@EdmundBaileyUK 3 месяца назад

Thanks Mark.

@stuartogden1660 2 года назад

Really enjoying your videos. Decumulation is of course a big issue at the moment following the 2015 pension freedoms. I agree that the tax angle, if handled badly, can undo a lot of any positives gained in the accumulation stage

@EdmundBaileyUK 2 года назад

Thanks so much for the kind words Stuart!! And absolutely it varies enormously from person to person as to their understanding of how a pension works and what is possible!!

@MrGrtx 2 года назад

Great video very helpful and well explained .Something to think about thanks.

@EdmundBaileyUK 2 года назад

Thanks Gary t!!! 🙏🙏

@Richard-kf7ul 2 года назад

Thank you for a very useful video. Was wondering, if you crystalise and withdraw £16,760 (Personal Allowance + Tax Fee Element), are you permitted to then re-invest £4,000 MPAA (Money Purchase Annual Allowance back into your SIPP ? If so, does this give further tax advantageous ?

@stuartogden1660 2 года назад

I'm a pensions actuary (yawn) and there are working groups within my profession looking at various ways of dealing with the retirement situation. Personally, I'm a drawdown person as I like the flexibility and have no plans to retire early due to a fairly low boredom threshold

@the-pissouri-two 6 месяцев назад

Very good and clear video, I have a question. I just rang my PRIVATE pension provider (Standard Life) UK and was informed that my only option on reaching retirement age was to Cash in my Pension plan and two annuities because I now live overseas (Cyprus.) They also informed me that I would also get heavily taxed for cashing in my plans. Is this true ?

@EdmundBaileyUK 6 месяцев назад

Thanks for the question and it sounds more like it is the actual personal pension which is limited in its options. Some older style arrangements will only allow either the purchase of an annuity or the taking of the whole pension as cash which clearly would have severe tax implications. I’m assuming you are near to your personal pension retirement date or age 75. The only other options will likely be to transfer to a UK arrangement that allows full flexi access DD, which will be tricky as the selection of providers if any will be limited or a QROPs.

@petearmstrong2778 2 года назад

Good examples covering the 'mathematical' aspects. What about the language used to convey your intentions to the platform for say a self-invested SIPP? How do they know £10k is either all tax-free or £2.5k tax-free and £7.5 taxable? Or crystalize a larger amount but leave some invested? The platform needs to keep an accurate account of my pension in terms of tax free amounts taken & left and taxable taken & left. Hope that made sense ... I haven't found this topic explained anywhere.

@EdmundBaileyUK 2 года назад

Thanks Pete and it’s a great question and one that would be best explained with examples. The process will be to some degree defined by the provider. For example in Scottish Widows flexi access form you define how much to crystallise by stating the amount the amount of tax free cash you want to take and the level of income you do or do not need. The plan is then split between benefits that have been crystallised and those that have not. The valuation will show the combined pot but the plan will have separate designations for each crystallisation.

@rickwhitehill1801 2 года назад

I found this very interesting. Unfortunately I already pay tax on my pension as the state pension on top of my company one takes me above the personal allowance. I have two Sips one of which I have not accessed, and the other I took the tax free lump a few years ago but no other income from it. I assume there is no way I could avoid tax now on any money I draw down?

@EdmundBaileyUK 2 года назад

Thanks for the kind comment Rick. Well depending on where you total income sits you definitely want to attempt to keep yourself out of the higher rate band, £50,270+. If that isn't a threat then it is typically a case of using your remaining tax free cash as part of your income. But you are correct that once your personal band is used up there is no way of completely avoiding income tax.

@DKNW62 2 года назад

Great video again Edmund, although i had to watch this few times. Do pension keep track of what proportions are Crystalised if you vary this?

@EdmundBaileyUK 2 года назад

Thanks so much for the kind words!! And absolutely the pension provider will keep the record of what is crystallised and what is not crystallised and the LTA used. 👍

@amerasinghamkarunananthan711 4 месяца назад

How would one claim/apply Personal Savings Allowance of £K and First Savings Rate of £5K? Pls explain 🙏🏽

@stevestreet7677 9 месяцев назад

Thanks Edmund. If I wanted to take the £16,760 tax free, would it make any difference if I used Flex-access drawdown or UFPLS? Both options would seem to have the same outcome.

@EdmundBaileyUK 9 месяцев назад

Thanks Steve. Yes the outcome is the same whether done via flexi access or UFPLS.

@stevegeek 9 месяцев назад

@@EdmundBaileyUK 😀👍

@tone.1 4 месяца назад

If you take your pension from a SIPP/Company DC pension (say up to your £12k personal tax allowance) does it arrive to you already taxed? If that £12k was your only earnings would you get a tax rebate if it was paid with tax already deducted?

@ABritishBoyAndAFilipina 11 дней назад

As far as I am aware, the 25% tax free amount of your pot is not taxed at source (obviosuly) but then if you draw an amount that is only income below your personal allowance they still deduct at source and you have to claim it back from HMRC, please anyone correct me if I am wrong.

@Toby_the_Glen 2 месяца назад

With flexible drawdown, Is it usual to take one annual payment or 12 monthly?

@EdmundBaileyUK 2 месяца назад

It’s more common to take monthly income payments typically as this is what most people are use to as far as their own spending needs.

@gordonmiln4855 2 года назад

Very useful. One observation though - do all flexi-access products offer complete flexibility as to how much of the pension you crystallise? Also it would be useful to know what the typical charges are for these products.

@EdmundBaileyUK 2 года назад

Thanks Gordon! And great question as each provider will have a slightly different application process when it comes to taking the tax free cash and or an income. But overall yes if it is a full flexible drawdown plan then you will be able to utilise partial and phased drawdown options, therefore define the tax free cash amount and the income level. However, i would say some providers make this process simpler and easier to work out than others. For example Scottish Widows will accept an instruction via email whereas Royal London would require an application. And costs is trickier still as some will charge one off transaction and set up fees for drawdown and others are simpler and have no additional fees but sometimes the provider charger is higher and percentage based which may or may not be beneficial depending on the size of the pension plan.

@gordonmiln4855 2 года назад

Hi Edmund. I would like to thank you again for covering this subject and bringing it my/the viewers attention. I think as a result of this I will now use flexible drawdown in a phased fashion, which will best suit my position when I reach retirement. I had a quick look at some of the larger providers and they seem to offer this option often at no additional cost.

@EdmundBaileyUK 2 года назад

Thank you Gordon. 👍

@peterbattle2116 3 месяца назад

What about the taking of your tax free cash 100% to avoid Labour reinstating the life time allowance should it come to power later this year? That way, there will be no tax to pay…

@tonyjenkins4920 8 месяцев назад

I was advised by one of my pension fund holders that if I took the 25% t/free lump at age 55 the remaining 75% remains ‘uncrystalised’. I was very specific on the “un-“ word and they said Yes. So are they wrong based on what you’ve just said in this video?

@EdmundBaileyUK 8 месяцев назад

Yes, you cannot take the 25% tax free lump sum without crystallising the remaining 75%. The point of the distinction is that you know whether or not the tax free cash has been taken, if crystallised it has been taken. If uncrystallised it has not been taken. Thanks for the question.

@robertjones7526 2 года назад

I took my 25% at age 55 next yr I will be 62 and am pplaning to take 12570 a yr until my pension kicks in at 67 My plan then is to top my state pension with my drawdown up to my personal allowance am I correct in thinking I won't be liable for income tax

@EdmundBaileyUK 2 года назад

Thanks Robert. And yes that would be correct.

@SBrown-xi2xt 2 года назад

Where did the figure £16,760 come from about half way through and what is the significance of this being £4190 higher than the personal allowance?

@EdmundBaileyUK 2 года назад

Thanks for the question S Brown. It means that if taken from the pension then no income tax is payable on the whole £16,760. As £12,570 is taxable income that falls within your personal allowance and the 25% tax free cash takes it up to £16,760. Therefore an income from the pension that faces 0 tax. Hope that makes sense.

@clivewilliams5668 2 года назад

Can you just take your 12.5 k personal allowance per year without touching your 25% tax free part? And use that at a later point as needed

@EdmundBaileyUK 2 года назад

Thanks for the comment Clive. No you can’t, you have to take your tax free cash either before or at the same time as the taxable element.

@andy1- 2 года назад

I am not a FA but the answer is no. I had the same idea but spoke to Vanguard today and asked the question. You have to take the tax free portion as a lump sum first. I am sure Edmund will advise.

@clivewilliams5668 2 года назад

@@EdmundBaileyUK so for example id probably need 20k a year...12.5 could be personal allowance and 7.5 would be part of my crystallised 25% tax free part?...or does it have to be a certain ratio? Many thanks for the reply

@EdmundBaileyUK 2 года назад

Thanks Clive, if the aim is to make up the balance from £12,570 to £20,000 with tax free income then the crystallisation would be £29,720 of which 25% is tax free cash = £7,430. Then only £12,570 of the taxable would be needed leaving £9,720 crystallised but in the pension.

@jefftrendell6421 2 года назад

@@EdmundBaileyUK …thanks for the info, that’s spooky as that’s exactly the question I wanted to ask. I have a total of 300k sitting in 2 pension pots and I am trying to decide how I can generate 20k in the most tax efficient way possible.

@tiffinmeister 3 месяца назад

If only the funds went up rather than down!

@onetone4561 11 месяцев назад

All of these calculations are based on the pension fund investments increasing I've had a pension fund invested with Royal London and over the last 4 year's there has been zero gains it varies +/- 4 k but no overall growth on 330k

@EdmundBaileyUK 8 месяцев назад

Thanks! This is very true and there will be periods of time when returns could be flat but in your case I would absolutely review where it is invested as 4 years is a long time with no growth.