What is pension drawdown?
It is the option you have at retirement to take money from your pension pots as and when you want. You can start to do this anytime once you are 55.
Apart from using Guiide what other options do I have if I want to drawdown my pension funds?
Pay for financial advice or work out a plan for yourself. There are sites that provide further helpful guidance such as the Money Advice Service that can help you further.
How much does financial advice cost?
It depends on many things, but for full independent whole of market financial advice, somewhere between £2,000 to £3,500 for at retirement advice on setting up a suitable drawdown plan including the investment and tax advice needed for this. There may also be additional costs for any pre retirement planning and annual reviews of your plan.
What exactly does Guiide do again?
It's aim is to improve retirement outcomes. In simple terms, if you want to drawdown your pension, it shows you how much you need to pay in before you retire, and how much to take from your pension and savings pots each month when you retire, to get what you want tax efficiently and avoid running out of money. It also shows you how much you can save in tax and in charges over the course of your plan, meaning more of your money can go towards your retirement income.
Why is there a need for Guiide?
A large proportion of people want to take their pension pots flexible at retirement. Whilst we recommend taking independent whole of market advice, a large proportion of people who do take their pots flexibly do not take this and "do it themselves". The Financial Conduct Authority (FCA) has recently stated this is unlikely to lead to the best outcome for these people and leads to many risks. Guiide helps those who want to do it themselves. Again the FCA and the Association of British Insurers (ABI) have both stated there is a need for innovation to help people who choose to do this.
Who built Guiide?
Guiide was built by a pensions actuary and programmers with many years of combined experience of advising individuals, companies and trustees on pensions and providing tools and communications to members of schemes in a way in which they can understand them.
What is an actuary?
You can see what actuaries do by visiting www.actuaries.org.uk. In short pensions actuaries know how to do all the boring maths work to make sure pensions can be paid, so you don't have to and can spend time doing something more interesting.
How much does Guiide cost?
Nothing, it's free forever as it says on the homepage, you will never pay anything to use Guiide.
Are there any other completely free sites that do what Guiide does?
We don't believe there are currently any other free sites or tools which do exactly what Guiide does. We think there is a need for it and that's why we built it.
Is my data safe?
I read somewhere you should take 4% of your fund each year to avoid running out of money?
This makes no sense if you think about it. A good drawdown plan will give you what you want each year, taking account of everything else you have, in calculating how much you should take. Nearly everyone will have a state pension for example and many others have incomes or savings they can use in retirement, so the amount you need usually changes year to year depending on what else you have and exactly what you want.
What other options do I have with my pension pots, other than drawdown?
Buy an income for life called an annuity, Guiide can't help you if you want to do this, you need to look for an annuity comparison website. You could always choose to take all your pot at once, however Guiide can't help you with this either as it's not usually a good idea unless your total pots are very small or you have another income big enough to live on in retirement.
What about tax?
You tell Guiide what you want after tax, so it estimates the tax you pay to work out what your after tax income will be. Guiide also shows you how to take your income in a tax efficient way so you save money on expected tax.
What if I can't even get the minimum I need?
Guiide shows you how much more you need to pay to get this, if you can afford to pay more, or gives you other options to consider if you can't.
I don’t want to use all my pension pots in retirement, I'd like to pass some on?
Guiide lets you set an amount to one side that you don’t want to touch and aim to pass on.
This all sounds great but what do I do once Guiide has made my plan?
We realise we can't do everything on our own to achieve our aims. Therefore we look to link to others who share our aims and can help you achieve these. Our first links are with OpenMoney, Pensionbee and Penfold.
How can OpenMoney, Pensionbee and Penfold help?
OpenMoney are a low cost pension and savings provider that also includes regulated advice within their low charges. Pensionbee are a specialist low cost pension provider which does not provide advice but lets you choose your own funds. Penfold are a low cost provider which does not provide advice. They specialise in the self employed, Ltd company directors and anyone else with variable incomes. Once you have built your plan in Guiide you can choose to use OpenMoney, Pensionbee or Penfold via the site to put your pension and possibly savings pots together and put your plan in place. An estimate of the savings you can make over the course of your Guiide plan, plus the other benefits from using OpenMoney, Pensionbee or Penfold are shown once you have built it.
If I want advice what type of advice does OpenMoney give?
OpenMoney provides restricted advice, which means they will give you a recommendation on whether it is in your best interests to transfer your pension and savings pots to them, or start a pensions or savings plan with them, as this is not always the case. If it is in your best interests and you choose to transfer to them or start a plan with them, OpenMoney will also give you a recommendation on which of their three investment portfolios appears the right choice for you. They will update this advice for you over the course of your plan. This type of advice is called restricted advice as it is based on their own products. There are no additional charges for this advice and it is included within their simple to understand annual charge.
Does using Guiide to build a plan and using OpenMoney to put it in place, provide me with all the benefits of financial advice?
We believe that building a free plan in Guiide and complementing this with advice from OpenMoney is a great way to get many of the benefits of advice at no additional cost. We also believe it is a much better option than trying to "do it yourself" with no help. However to be clear, it does not provide everything that independent whole of market financial advice does, such as a full review of all product providers, a review of all possible investment opportunities, or advice on more complex tax and investment issues. If you require this level of advice, then we recommend you take independent whole of market financial advice. Pensionbee and Penfold do not provide advice, but are great low cost alternatives for people that are happy to choose their own funds without advice.
Can I just use my Guiide plan with my own pension and savings providers?
Yes of course you can. You should check their charges and see how they compare using the slider in the Finish page with OpenMoney and Pensionbee.
I have total pension pots close to £1,000,000 and may have lifetime allowance tax issues
Good for you. We would recommend you seek an independent financial adviser and discuss these tax issues with them. Guiide will not be able to help you with any complex tax issues you may have like this, but for most people this will not be an issue.
I have a final salary based pension from my old employer?
Guiide can include the income from one or more of these in your plan. Just put the details in Guiide and it will build your drawdown plan around the income from these and everything else you have.
Can I transfer this final salary pension to a pension pot?
It is possible that you can, but Guiide can't help you with this, you will need to speak to a financial adviser who specialises in providing advice on these types of transfers. In nearly all cases you cannot do this without specialist financial advice. To be clear, OpenMoney will not provide any advice on transfers from a final salary (defined benefit) scheme and Pensionbee and Penfold cannot accept a transfer from a final salary scheme unless you have taken specialist financial advice.
Can I put my husband/wife/partner's retirement pots and income in the same plan?
At the moment you can only do one plan at a time, just split the total amount you want between the both of you and let Guiide build a separate plan for each of you. If Guiide is popular we aim to add a joint feature at some point in future.
Can I use various different growth assumptions for many different pension and savings investments?
Guiide is designed to be a simple tool for individuals who know little about pensions and investments to use themselves. It allows you to use one assumption for your pension pots overall and one for your savings pots overall. It assumes you will put the pension pots and savings pots in one simple ready made portfolio for each of these rather than choose a range of funds or individual investments. If you want to choose a range of funds or pick individual investments, again we would recommend you seek independent financial advice on this unless you have a lot of experience of managing your own investments.
Is Guiide FCA regulated?
Guiide is not FCA regulated or authorised by the FCA to provide advice, as it does not provide advice. It only provides guidance and calculations to help you build a plan. We have had lots of discussions with FCA innovate when building Guiide. They have confirmed that Guiide does not do anything that requires FCA regulation for anyone that wishes to use their plan with their own provider or any other provider which is not introduced to them via the site.
What if I use Guiide to build a plan and then use OpenMoney, Pensionbee or Penfold via the site, rather than my own provider?
If you seek advice from OpenMoney by following the link on our site, this introduction is a regulated activity. OpenMoney are authorised and regulated by the Financial Conduct Authority (FCA). If you choose to put your pots together with Pensionbee or Penfold by following the links on our site this is also a regulated activity. Pensionbee and Penfold are also authorised and regulated by the FCA. Guiide is classed as an Introductory Appointed Representative of OpenMoney, Pensionbee and Penfold which allows Guiide to provide the links to OpenMoney, Pensionbee and Penfold on our site.
Does Guiide get paid by OpenMoney, Pensionbee or Penfold if I put my plan in place with them?
Yes, to be completely clear Guiide is paid by OpenMoney if after taking advice, you choose to put your plan in place with them. The same is true if you choose to put your plan in place with Pensionbee or Penfold without advice. That makes it possible to provide a site like Guiide for free to anyone that wants to use it to build a plan. There are no additional charges to you in using OpenMoney or Pensionbee via Guiide, these are exactly the same as if you went to their sites directly with your own plan. For Penfold we have even negotiated lower charges for anyone going through Guiide to them with pots over £100,000 than are currently available directly.
If you have any other questions please email email@example.com and we will answer these for you