Releasing Pension Money

angelofabundance

I have a friend who has been receiving maintenance from her ex husband for about 11 years.
He agreed to pay her a lump sum to finish the arrangement.
She was thinking of marrying her long term partner anyway (when payments would have stopped) and agreed. I think he's paid her about £10,000.
She does not have a pension to speak of only a few years with the NHS.
She is going to sell her home, will release some capital and buy a small house for her son to rent from her as he will effectively be without a home when she moves to be with her new husband.
The rent will be additional income for her and her new husband and when they retire (about 16 years) she will sell the house and they will buy a small property as a holiday home. But they will always have a home provided for them until they die by her new husbands employers. Even if he died first she is able to live in the house until her demise.
I seem to remember reading somewhere that you can put money into a pension scheme and then access some immediately (after you are 50?) and wondered if this might be an option for her to make her funds go a little further.
She is 50 later this year.
Another problem is that her son has not been the most reliable about paying bills. He might not pay the rent reliably, but she sees this as a way of helping him onto the property ladder eventually, firstly by getting him used to paying regularly.
She also has another son who would like to buy but lives in London and is therefore finding it a struggle to get started on the property ladder.
If she could help them both in some way without losing too much herself, then this would make her very happy.
Any thoughts or good advice upon this matter will be gratefully received.
I understand too that in 2006 it will be possible to release pension money to buy to let, perhaps another avenue to explore.

dunstonh

immediate vesting pensions allow you to pay into a pension and commence immediatly, providing you are over the age of 50. At age 65, this can be a very good way to get a good rate of return (in effect, over 10%p.a.). At age 50, it wouldn't be as good as that.

From April 2006, there are proposals to allow property purchases to be made from funds already in a pension. This is still under consolutation and the workings and restrictions are not fully known yet.

angelofabundance

This is probably a silly question, but could she give the money to her mother to put in a pension and then draw it out?

dunstonh

Her mother could make a contribution and get better annuity rates but the annuity would cease on her death.

angelofabundance

She's in her 80s, so perhaps not the best idea!

dunstonh

ah. over 75 she cant do an IVP anyway.