Pension underpin

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Beach78
Beach78 Posts: 2 Newbie
in Pensions, annuities & retirement planning
Was advised could take a deferred pension at 55 years old as a lump sum with 25% take free by the managing company last August, have just spoken with them to make said arrangements and they now say as needs to be underpinned cannot take funds until 60, my only option they say is to transfer to another pension scheme with said underpin.
If I transferred to another pension fund with said underpin, would I be able to take as a lump sum before reaching 60 then? Very confused ?

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  • dunstonh
    dunstonh Posts: 116,558 Forumite
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    If I transferred to another pension fund with said underpin, would I be able to take as a lump sum before reaching 60 then? Very confused ?

    With many of these, you can transfer them out and give up the final salary underpin. Of course, that doesnt mean it is a good thing to do. Just that it is technically possible.

    It would requre an IFA due to the final salary underpin.
    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.
  • badmemory
    badmemory Posts: 7,870 Forumite
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    Beach78 wrote: »
    Was advised could take a deferred pension at 55 years old as a lump sum with 25% take free by the managing company last August, have just spoken with them to make said arrangements and they now say as needs to be underpinned cannot take funds until 60, my only option they say is to transfer to another pension scheme with said underpin.
    If I transferred to another pension fund with said underpin, would I be able to take as a lump sum before reaching 60 then? Very confused ?

    They have said it to too many who have gone ahead before you & now the SHoneT has hit the fan.?
  • xylophone
    xylophone Posts: 44,562 Forumite
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    Is this a deferred defined benefits pension with GMP?

    Or was it a money purchase pension with a GMP underpin?

    http://www.nortonrosefulbright.com/knowledge/publications/141433/pensions-briefing-guaranteed-minimum-pensions
  • Beach78
    Beach78 Posts: 2 Newbie
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    yes is deferred-lloyds pension pip scheme 1.
  • xylophone
    xylophone Posts: 44,562 Forumite
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    This?

    https://www.lloydsbankinggrouppensions.com/scheme_benefits/understanding_your_pip

    If so, have you logged in to your pension?


    Your PIP has to give you a certain level of income
    Under the Scheme rules, your PIP has to be big enough for you to be entitled to a certain level of income from the arrangement. When you come to use your PIP account, we work out what this level of income is. If your PIP isn’t big enough to provide this income, the Scheme tops up your PIP so that it can. This arrangement is called an underpin.

    If your PIP gets topped up by this underpin, it doesn’t mean that you have to take an income from the Scheme. You still have all three options above    .



    It would seem that your PIP is not currently big enough for you to take benefits from age 55 and that no underpin (if required) would be applied until you reach age 60.
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