Can I cash in my pension?

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  • dunstonh
    dunstonh Posts: 115,907
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    Sorry for your situation.
    But how do I time it in view of the hideous fluctuations in the financial market?

    By not investing in the markets. You can use cash, gilts or other low risk fixed interest securities. A pension invests in what you tell it to invest. So, if you dont want the stockmarket, you choose investments that do not include the stockmarket.
    Is the best indication the ftse index?

    Only if you happen to be in a fund that tracks the ftse.
    how do I get it posted and 'acted on' by the insurance company (AEGON) before it drops again?

    By telling them which funds you want to go into.
    how do I get it posted and 'acted on' by the insurance company (AEGON) before it drops again?

    crystal ball job.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • jamesd
    jamesd Posts: 26,103
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    Do you have sufficient money for your needs if you take it all now? If you take out part of it now? If so it may be best to do that, since what you're really asking is whether it's safe to leave the money invested in the hope that its value will increase. If you don't need that increase, you don't need to stay exposed to the risk of say another 20% drop if Greece defaults or lots of countries vote against the EU rescue package.

    If you do want to get some protection but still have a chance of gaining, as dunstonh wrote, you can use investments other than equities (shares), including corporate bond funds,savings accounts (even inside a pension).

    Do you actually need it all now even if you can take it now? If you don't plan to spend it all then you might take it and then pass it into the control of whoever you want to have the remainder a year from now. Then their own tolerance for risk and ability to handle drops could be used instead of your own. Since in this case it comes out of your pension but then is immediately invested again they don't have long out of the markets, just as long as it takes to move the money around and get it reinvested.

    If the amount is more than a few tens of thousands, certainly if it's hundreds of thousands, then you might also consider visiting unbiased.co.uk to find an IFA for some personal financial advice.

    But do consider carefully the question about what you're trying to gain by leaving it invested and whether you can get the same benefit by just doing whatever the person who will eventually have the money wants, instead of using your own possibly shorter timeframe. This may be the easiest and best solution.
  • Thank you Jamesd and Dunstonh. It is only about £15,000 that I want to cash in and use, with adequate other income. The trouble is that the lump sum is rapidly dimishing and I am trying to decide whether to grab it or wait! Thanks for your sensible views. Very grateful.
  • Lokolo
    Lokolo Posts: 20,861
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    Unfortunately we are in troubled times and anything is possible. It's just a matter of waiting to see what happens. Greece could come out of it better than expected - which would help markets, but on the other hand, Greece could end up in the worst possible situation, and the markets would continue to fall.

    Personally (this is not financial advice!!!!!), if I were you I would take the money now if you can afford it, only because I'd rather make the most of the time left, rather than worry about losing money should the markets continue to fall.
  • jamesd
    jamesd Posts: 26,103
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    Perhaps grab it and invest half of it in the same investments? That way you either gain something or don't lose as much. No way to know how any plan would would out, things are too unsettled at the moment to even hazard short term guesses.
  • pauls100
    pauls100 Posts: 3 Newbie
    edited 30 September 2011 at 2:21PM
    Are there any circumstances (short of death!) where, once a pension is in payment it can be stopped,diverted or converted to a lump sum etc. This question relates to a pension of £240 per annum which is taking the recipient over the limit for basic benefits e.g. council tax relief and is therefore costing them money!
  • dunstonh
    dunstonh Posts: 115,907
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    Are there any circumstances (short of death!) where, once a pension is in payment it can be stopped,diverted or converted to a lump sum etc. This question relates to a pension of £240 per annum which is taking the recipient over the limit for basic benefits e.g. council tax relief and is therefore costing them money!

    Theoretically, it is possible for a trivial annuity to be unravelled and paid as a lump sum. The rules allow it but there are very few that will actually do it.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • Could they pay it into another pension and would it then not be counted as inome?
    (AKA HRH_MUngo)
    Member #10 of £2 savers club
    Imagine someone holding forth on biology whose only knowledge of the subject is the Book of British Birds, and you have a rough idea of what it feels like to read Richard Dawkins on theology: Terry Eagleton
  • What's the situation in the case of redundancy at age 50 -55?Can the pension be drawn under these circumstances?I will be 52 next April and fear the worst.
  • dunstonh
    dunstonh Posts: 115,907
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    What's the situation in the case of redundancy at age 50 -55?

    Nothing in respect of pensions.
    Can the pension be drawn under these circumstances?

    no
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
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