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  • FIRST POST
    • singhini
    • By singhini 5th Oct 17, 8:17 PM
    • 186Posts
    • 104Thanks
    singhini
    Pension company not telling me what my pots worth
    • #1
    • 5th Oct 17, 8:17 PM
    Pension company not telling me what my pots worth 5th Oct 17 at 8:17 PM
    ive got a pension pot from a previous employer and I was wondering what the pot might be worth so I rang the number on some old paperwork.
    I was told that they cant tell me over the phone but they will write to me with the information.


    Three weeks passed and I received nothing so I rang them yesterday to ask where is the paperwork (I was told that they were calculating what the pots worth and will email me the info tomorrow). Well tomorrow is now today and I still haven't got the information


    Q1 - Is it normal practice to "work out what the pots worth"? (I thought they would know this information on a daily basis).


    Q2 - Also all my other pension providers write to me on an annual basis to tell me this information yet this pension provider doesn't send me anything, I have to ring up and request a valuation (is this normal, I thought all pensions providers had to send annual statements)?


    Any thoughts
Page 2
    • JoeCrystal
    • By JoeCrystal 7th Oct 17, 2:54 PM
    • 1,276 Posts
    • 728 Thanks
    JoeCrystal
    I will need to take advise and be able to prove I have taken advise should I want to transfer the money to a DC scheme (I'm thinking i could just take free advise from people like Pension Wise, Citizens Advice or Pension Advisory Service)
    Originally posted by singhini
    It is not that straightforward. You need an advice from an IFA who got special qualification to analyse if the transfer is worth it or not. They don't come cheap since it is easily one of the most riskiest transactions that the IFA have done.
    • xylophone
    • By xylophone 7th Oct 17, 3:30 PM
    • 23,116 Posts
    • 13,399 Thanks
    xylophone
    I will need to take advise and be able to prove I have taken advise should I want to transfer the money to a DC scheme (I'm thinking i could just take free advise from people like Pension Wise, Citizens Advice or Pension Advisory Service)
    No.

    http://www.pruadviser.co.uk/content/knowledge/technical-centre/pension_transfer_conversion/

    You need to take the advice of a Pension Transfer Specialist.

    It won't be free and it won't be cheap.

    It concludes that I need to read the scheme policy booklet (which I haven't got
    It may be possible to find the booklet on the internet.

    What does your statement of benefits on leaving say?
    • xylophone
    • By xylophone 7th Oct 17, 3:41 PM
    • 23,116 Posts
    • 13,399 Thanks
    xylophone
    And have you obtained a new state pension statement?

    https://www.gov.uk/check-state-pension
    • Keep pedalling
    • By Keep pedalling 7th Oct 17, 4:59 PM
    • 3,752 Posts
    • 4,016 Thanks
    Keep pedalling
    So having read the letter from two years ago, this is what I took from it:


    1 - As suggested, as its a DB scheme and the transfer value is over £30,000 I will need to take advise and be able to prove I have taken advise should I want to transfer the money to a DC scheme (I'm thinking i could just take free advise from people like Pension Wise, Citizens Advice or Pension Advisory Service)


    2 - The transfer value is guaranteed for 3 months from the point of them writing to me


    3 - They want original passport and birth certificates should I want t transfer the money (not photocopies)


    4 - transfer value is £80,000 which includes member contributions


    5 - there is "attaching provisions for your dependents" (I haven't got any)


    6 - its covered by the pension protection fund


    It concludes that I need to read the scheme policy booklet (which I haven't got). So I cant answer Xylophone's questions in post #9


    A completely different letter addressed to me basically tells me the fund is circa £580 million short and they intend to put £33 million into it every year until 2027 to make good the shortfull.


    I going to ring them again on Monday and ask them again where is my letter / email with an upto date transfer value (as its been 3 weeks and ive had no correspondence).


    thereafter I will leave the money alone and just before my 55th birthday I will transfer this pension (along with all the other pension pots into a single SIPP), then aged 55 I will start to withdraw circa £11,500 (or whatever the HMRC tax free allowance is when I'm 55) and live off these funds and bank savings (eventually liquidating the SIPP and using up my bank savings and eventually selling my current house and moving into a retirement flat and finally living off the proceeds of the house sale.


    I came into this world with nothing and I intend to leave it with nothing
    Originally posted by singhini

    You will probably overachieve with your intention and spend a good few of your last years with nothing.
    • atush
    • By atush 8th Oct 17, 4:26 PM
    • 16,295 Posts
    • 9,962 Thanks
    atush
    Note to myself: I hate pensions, I don't understand them
    This is just, well, silly.

    You hate something you dont understand. Which means you dont know enough to hate it.

    £3500 a year (whch will increase every year between now and your retirement by a figure set in your scheme rules) is fantasic value for the pitance you paid for it in the past.

    Be happy about it, and suppliment by pension payments whith who you are working for now, and a S&S isa to boot.
    • somethingcorporate
    • By somethingcorporate 8th Oct 17, 11:42 PM
    • 8,835 Posts
    • 8,519 Thanks
    somethingcorporate
    You paid £8500 (probably including tax relief) for something worth £80k (3 years ago) and think that is bad value?

    You really need to give your head a wobble.

    Tell me one other area in your financial life where you have seen anything like this unbelievable return?
    Thinking critically since 1996....
  • jamesd
    So, the old transfer value was £80,000. It'll probably be more like £100,000 now but you'll find out soon enough.

    Say you transferred and started to defer claiming your state pension, living off the £80,000 instead. I'll assume £8,000 state pension, it changes the number of years but not the overall point. After 7.5 years your state pension would be £3,500 higher because it goes up by 5.8% a year. You'd have spent £60,000, would have the same ongoing income as the work pension but also £20,000 left over to use as you like.

    I've ignored investment gains on the £80,000, state pension increases and possible inflation linking differences between work and state pensions.

    Transferring can easily be one of the best decisions you can make.

    Use some caution with IFAs. They might not bother to tell you about state pension deferring and pretend that buying an annuity is the only way to get guaranteed income. Annuities will probably pay less than the work pension and less than half as much as state pension deferring if your health is good. If it's bad or there are major life shortening lifestyle factors like smoking an annuity could pay more. Worth checking, but don't be suckered into just accepting that and letting state pension deferral be ignored. Insist on it being included as one of the comparison options.

    Of course another thing to consider is your desire to retire earlier. At its normal age that work pension pays just 4.4% of £80,000 plus inflation linking. Getting 7% or more from even quite cautious overall mixtures isn't hard at the moment but that doesn't allow for inflation increases. You could well find that from 55 you can get more than the work pension pays at 65 then defer your state pension to guarantee it for life.
    Last edited by jamesd; 09-10-2017 at 2:42 AM.
    • singhini
    • By singhini 10th Oct 17, 7:31 PM
    • 186 Posts
    • 104 Thanks
    singhini
    Well the paperwork came today (butch of w@£$%rs, the letter states the valuation for transfer purposes is only valid until 29th September. What use is that when I received the letter in October).


    Anyway the transfer value is now £105,000 with a annual pension of £4,500


    The elephant in the room for me is the fact the pension fund is circa £588 million short and their intending to put £33million in to it until 2027


    I suspect the fund is going to collapse so I'm going to take the money out and stick it in my SIPP


    I don't care if inflation errods its value (ive got £105,000 and I still start to draw off this pot along with all my other pots in the next 8 years)


    Thanks for everyone's comments and suggestions but I'm not waiting around for a fund to collapse.


    See you all in the casino
    • bigadaj
    • By bigadaj 11th Oct 17, 3:24 AM
    • 10,320 Posts
    • 6,616 Thanks
    bigadaj
    Well the paperwork came today (butch of w@£$%rs, the letter states the valuation for transfer purposes is only valid until 29th September. What use is that when I received the letter in October).


    Anyway the transfer value is now £105,000 with a annual pension of £4,500


    The elephant in the room for me is the fact the pension fund is circa £588 million short and their intending to put £33million in to it until 2027


    I suspect the fund is going to collapse so I'm going to take the money out and stick it in my SIPP


    I don't care if inflation errods its value (ive got £105,000 and I still start to draw off this pot along with all my other pots in the next 8 years)


    Thanks for everyone's comments and suggestions but I'm not waiting around for a fund to collapse.


    See you all in the casino
    Originally posted by singhini
    The valuation, with consequent liabilities and nominal shortfall, are based on a number of assumptions and situations and largely ignores future growth, if it did fail, which is unlikely, then it would fall into the protection fund with the majority of payment guaranteed.

    How are you going to transfer this given its not clearly in your interest and you need to find someone qualified to sign it off, you'll struggle particularly as you know little about finance or the mechanism and criteria required.

    Cue next post wailing about the fact you can't get hold of your money, even though it isn't your money.
    • Keep pedalling
    • By Keep pedalling 11th Oct 17, 9:09 AM
    • 3,752 Posts
    • 4,016 Thanks
    Keep pedalling
    Well the paperwork came today (butch of w@£$%rs, the letter states the valuation for transfer purposes is only valid until 29th September. What use is that when I received the letter in October).
    Originally posted by singhini
    i only see one w@£$%r here.
    • xylophone
    • By xylophone 11th Oct 17, 9:49 AM
    • 23,116 Posts
    • 13,399 Thanks
    xylophone
    I suspect the fund is going to collapse so I'm going to take the money out and stick it in my SIPP
    Have you found a pension transfer specialist?

    Will your SIPP accept a transfer in if the PTS will not give a positive recommendation?
    • bigadaj
    • By bigadaj 11th Oct 17, 10:14 AM
    • 10,320 Posts
    • 6,616 Thanks
    bigadaj
    Have you found a pension transfer specialist?

    Will your SIPP accept a transfer in if the PTS will not give a positive recommendation?
    Originally posted by xylophone
    What do you think?
    • Malthusian
    • By Malthusian 11th Oct 17, 12:24 PM
    • 3,070 Posts
    • 4,450 Thanks
    Malthusian
    The elephant in the room for me is the fact the pension fund is circa £588 million short and their intending to put £33million in to it until 2027

    I suspect the fund is going to collapse so I'm going to take the money out and stick it in my SIPP
    Originally posted by singhini
    Perhaps when you've run out of money you could ask the sponsoring employer to top your SIPP back up, as they are doing with the defined benefits pension fund. Actuaries can always use a good laugh.

    The underfunding of the scheme is virtually irrelevant to you. Not a single payment has been missed and an "underfunding" problem can disappear with a few changes to the actuary's assumptions. The financial strength of the sponsoring employer is what matters. And even if they're about to go bust, most people are better off in the Pension Protection Fund, even after the 10% reduction, than taking the transfer value.

    I don't care if inflation errods its value
    If I give you my bank details could you send me 2.5% of your SIPP every year?

    If the answer's no, why do you care about the money I've asked for but not the money you're losing to inflation?
    • Terron
    • By Terron 11th Oct 17, 12:24 PM
    • 80 Posts
    • 86 Thanks
    Terron
    The elephant in the room for me is the fact the pension fund is circa £588 million short and their intending to put £33million in to it until 2027

    See you all in the casino
    Originally posted by singhini
    Pension fund shortfalls are based on a prediction on whether their current funds will make enough if interest rates remain the same. Interest rates are likely to go up very soon, which will increase the predicted value and cut the amount they are short.

    I won't be in the casino. Only the house wins in the long run.
    • dunstonh
    • By dunstonh 11th Oct 17, 12:48 PM
    • 89,852 Posts
    • 55,455 Thanks
    dunstonh
    The elephant in the room for me is the fact the pension fund is circa £588 million short and their intending to put £33million in to it until 2027
    So, not really a problem there. Also remember that the assumptions that are used to measure funding levels are overly cautious nowadays. They have to effectively assume the worst.
    • coyrls
    • By coyrls 11th Oct 17, 12:53 PM
    • 886 Posts
    • 912 Thanks
    coyrls
    Well the paperwork came today (butch of w@£$%rs, the letter states the valuation for transfer purposes is only valid until 29th September. What use is that when I received the letter in October).


    Anyway the transfer value is now £105,000 with a annual pension of £4,500


    The elephant in the room for me is the fact the pension fund is circa £588 million short and their intending to put £33million in to it until 2027


    I suspect the fund is going to collapse so I'm going to take the money out and stick it in my SIPP


    I don't care if inflation errods its value (ive got £105,000 and I still start to draw off this pot along with all my other pots in the next 8 years)


    Thanks for everyone's comments and suggestions but I'm not waiting around for a fund to collapse.


    See you all in the casino
    Originally posted by singhini
    As you've already said, you don't have a clue about pensions.
    • sandsy
    • By sandsy 11th Oct 17, 3:13 PM
    • 1,195 Posts
    • 693 Thanks
    sandsy
    £588m, relative to what value of liabilities? What’s the DB deficit as a %?
    Has your CETV been reduced due to the deficit? Unlikely to be considered as an reason for transferring if not.
    How does £33m pa compare to the employer’s revenue and profits annually?
    • Thrugelmir
    • By Thrugelmir 11th Oct 17, 6:31 PM
    • 55,533 Posts
    • 48,881 Thanks
    Thrugelmir
    Anyway the transfer value is now £105,000 with a annual pension of £4,500

    I suspect the fund is going to collapse so I'm going to take the money out and stick it in my SIPP

    Originally posted by singhini
    Where do you plan to invest the money in order to return you with an indexed linked income of £4.5k per annum.
    "Wide diversification is only required when investors do not understand what they are doing." - Warren Buffett
    • singhini
    • By singhini 11th Oct 17, 7:14 PM
    • 186 Posts
    • 104 Thanks
    singhini
    i only see one w@£$%r here.
    Originally posted by Keep pedalling


    Thanks for everyone's comments and suggestions but if taking the money out and holding it in my bank account makes me happy then I don't see what's wrong with that.


    Keep pedalling: I've been called much worse than that (I was born with brown skin in this country back in the 1970's), so please feel free to call me what you like
    • Silvertabby
    • By Silvertabby 11th Oct 17, 9:11 PM
    • 1,657 Posts
    • 1,987 Thanks
    Silvertabby
    “ Anyway the transfer value is now £105,000 with a annual pension of £4,500. Thanks for everyone's comments and suggestions but if taking the money out and holding it in my bank account makes me happy then I don't see what's wrong with that. Posted by singhini
    Nothing wrong at all. If you are serious about transferring this pension to your bank account and are happy to pay at least £32K in tax then I, as a taxpayer, applaud you for your generosity.
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