J T

john_towersey

I am 63 and have a fully paid up pension plan.
In view of the current financial situation, would I be better off using the open market option, and putting the cash into a high interest account, knowing that my money is guaranteed by the govrnment , should the bank fail?
Unlike an insurance company.

Debt_Free_Chick

You can't do that. There is no way to take cash out of a pension plan and put it in a bank account. The open market option is controlled by the pension company, who will only transfer or send a cheque to another pension company.

And the Financial Services Compensation Scheme applies to insurance companies as well as banks, so you have the same protection.

Possetjohn

As I understand (and I am no expert) the open market option only allows you to pick the best annuity option at the time you choose to take the pension.

Depending on the plan you should be able to take up to 25% as a tax free lump sum, so you could choose to invest that in "your bank". Not many are paying any worthwile interest at present anyway!!

Your other option (again depending on the plan) is to keep the pension invested and take drawndown income. This assumes the growth is sufficient to finance the drawdown. Not easy at the moment, but maybe improved if you wait until 65? You can do this up to 75 years old, when you are forced to take an annuity.

Others who are more expert may be along shortly!!