Redundancy close to Retirement?

ragtagbobtail

does anyone know of any rules precluding redundancy payment within 1 or 2 years of retirement. i am fortunate to have an enhanced redundancy package with my company but also pay into the stakeholder pension plan. many thanks for any answers

getmore4less

There are none that I know of.

Depends on the company enhanced package and pension scheme rules

You need to look up your own companies rules.
They should have been modified to take account of the age discrimination laws. Note the normal retirement age needs to be justified if below 65.

With a stakeholder the pension may not be a factor.

Stat redundancy used to have clawback if close to retirement but that was dropped to comply with age rules so you will be entitled to that redundancy as a minimum.

Depending on age and service this can be up to £10500(going up in Oct).

ragtagbobtail

Many thanks getmore4less, for your response. I will check the company rules as you suggest.

debtworrier

If you are made compulsorily redundant and you're nearly at retirement age (the magic age is actually 50+) then you are entitled to take early retirement.

Normally if you take early retirement then your pension gets reduced for two reasons:

1) you haven't made as many contributions because you're stopping work sooner

2) you will probably be claiming the pension for longer. This is obviously a guess based on how long people live on average, and is computed from risk tables. The formal name for this is "Actuarial adjustment".

However if you're made compulsorily redundant then your pension does not have the actuarial adjustment applied.

Ask your company/pension scheme for a statement before you decide though, and don't forget to factor in that because you will have an income you won't be eligible for certain benefits (e.g. council tax)