Charlottesquare wrote:One observation- lot of discussion about sheltered funds/unsheltered funds, I would actually aim at getting funds out of say a SIPP before out of unsheltered funds as I have an intrinsic fear of future politicians and their meddling and think I would wish to say use the 25% tax free figures whilst available. (Also not sure how the funds post 75 will in future get treated re in/out estate and IHT)
Of course my paranoia may be misplaced, but I took the same view staying contracted out as long as possible, despite the IFA view I should contract back in, I wanted control with me rather than with HMG and that did work out okay.
I feel your paranoia. When I was in my 40s and planning my escape I took company pensions contributions but always focused investment to ISAs and unsheltered. My fear was the government would monkey with the rules; push access further out. As I hoped to be FI around 50 I didn't want my money locked away. Then the pesky government changed the rules on taxing dividends, as I neared 55 the SIPP seemed the better deal, I leveraged the income tax too and will continue to benefit from that. Getting the whole 25% out the SIPP promptly became the plan. I can probably stay below tax threshold with my pension income and have plenty in other funds, but if I feel like an income uplift or big spend I can choose take the tax hit from the SIPP or not from the ISA. No spawn o IHT irrelevant to me.
Government could still change the rules and find a way to tax my investment income which would scupper the plans but taxing ISA gains or dividends feels unlikely. Taxing the SIPP at prevailing rates is expected and I have some control over how much I extract.