pension not paying out..

maks_3

Hi,

On behalf of my mother...

She retired last summer and had a pension fund with a certain company (dont want to break any forum rules) . In order to claim her pension she had to fill all the forms and send of her birth/marriage certificates etc.

Between her previous employers and her pension fund company, they still haven’t paid out her monies (she decided to take it as a lump sum). I have called several times to the pension fund company, but they say someone will investigate and get back to us, yet its been 9 months now and I think they have messed up some records as they recently moved office.

Is there an independent body I can complain to? Or at least seek advise? Her fund company is a big well established company, but I’m getting promises of someone will call you back, but no one does!!.

Thanks.

EdInvestor

You can't take a pension as a lump sum. A maximum of 25% of a fund can be paid out as tax free cash.

In order to get her pension income she needs to convert her fund into an "annuity".This is a quite separate product. She needs to shop around to get the best annuity rate for her money.

Current annuity rates

She can get an advisor to do this for her - such as the company in the link above ( no connection). The insurance company will pay the advisor a commission - about 1% of the fund IIRC.If you want to avoid paying that, check around yourself and then go through a discount broker such as https://www.cavendishonline.co.uk which will rebate the charges.

If she has any illnesses, is overweight or a smoker she may be able to get an "impaired life annuity" which will pay out more money.

There are also other ways of taking pension money but they all involve some risk.

Hasn't the insurance company suggested she see an IFA/advisor?

maks_3

Sorry, i think you have mis-understood me.

She is entitled to the money as she can either have a lump sum or get it paid monthly, as the figure was low <£10000 she had an option to take it as 1 lump sum. My problem here is the inability of the pension fund company to get back to us to give her the money they said she was owed. Rather like a person contacting OFCOM for problems with telephone company, who can i contact for pension's advise. I get the impression that they have lost my mothers paperwork and her trying to sort it out, but this payment should have been made to her last september.

She had spoken to a finaclial advisor last summer when she was given the options, and he advised to take the lump sum.

Thanks.

dunstonh

According to Cavendish's website, they dont appear to offer annuities on execution only basis. Probably due to the workload involved and of course execution only means no advice whatsoever. Nobody comes to you and says "i want to take my annuity with xyz company".

Pension commencement can take a few weeks but it can also take many months. Indeed, I have one case which started over 12 months ago but cannot get the insurer to release the funds (at least not until A day when the rule blocking it goes away).

Best bet is to get an IFA involved as they can get to the root of the problem and probably get it sorted. If that then fails, a complaint can be made to the pension company. If the result of that is not to your liking, then you may be able to consider the ombudsman. However, you cannot jump to the ombudsman straight away.

edit: I started my post before your last one.... Can you clarify what type of pension you are talking about? You can name them, there is no rules against that.

EdInvestor

maks wrote:

Sorry, i think you have mis-understood me.

She is entitled to the money as she can either have a lump sum or get it paid monthly, as the figure was low <£10000 she had an option to take it as 1 lump sum.

Oh I see.

Very simple explanation: it's not legal for her to take it until after the new pension regulations come in on A day, April 6.

She should get it after that

Pal

A lot of assumptions going on here, so lets try and clear it up with a few more questions...

Maks -

- what sort of pension scheme is it? A company scheme or a personal pension?
- What is your mother's actual retirement date as far as the scheme is concerned? She may have been given options nine months ago but if her retirement is not for another month....
- What actually were the options she was given? A lump sum only, or a lump sum and a smaller pension amount?

If you want to complain you should write to the scheme/provider asking for details of its complaints procedure. You have to go through the official procedure anyway before the financial or pensions ombudsman will even look at your case.

Pal

maks_3

Hi,

- It’s a company pension scheme, she’d been paying into it for around 10 years before she left the company.(a retirement benefits scheme)
- Mothers actual retirement date was 10th April 05, during that time she was sent a lot of paperwork to release her pension, this was filled in and sent back.
- She was given an option of a lump sum or a very small pension amount, they even advised its best to take the lump sum. The lump sum was sent as a quote as the figure changes everyday. She’d paid into this fund from 1982 to 1992(10 years)

She had been dealing with her ex-employees HR department with all forms etc and they were to send the details off to the pension fund company. There appears to be a breakdown of communication between the her –employees and her pension fund company (AXA Life).

I’m getting concerned the money isn’t being paid out, almost a year after she ‘officially’ retired, and when call AXA, I have to explain the whole situation again and then they say, they’ll call me back, but no-one does.

dunstonh

If it is a money purchase scheme, you do not want to be dealing with AXA. It's not their job and you are wasting yours and their time. They do not handle the paperwork directly and have no records kept of what you want to do. Chances are you are speaking to the call centre who take information and then pass it to pensions dept. They in turn dont deal with it so may pass a note on to the adminstrators or they may even just close the enquiry. Its quite possible that AXA do not have the address and telephone number on file. Again, that is held normally with the administrators. You need to deal with the scheme administrators.

EdInvestor

Is it an occupational defined contribution pension scheme (which would have company trustees at the firm where she worked) or a group personal or stakeholder pension scheme ( which is actually a whole lot of personal pensions grouped together for staff but is actually managed and run by the insurance company)?

In the first case you need to deal with the company Pension/HR dept.In the second, you would deal direct to the insurance company, though there may be an IFA employed by the company to answer staff queries (exactly like this one) on the GPP.