Serps pension

ceridwen

Having heard about someone having withdrawn 25% of their SERPS pension as a tax-free lump sum at 50 (would now be 55 instead) - does anyone know the details as to how to withdraw any of the SERPS pension I have saved?

I am entitled to a full Basic State Pension when I reach the age to get it - and am concerned that if I leave my SERPS pension sitting there in "savings" then I may find that it vanishes into thin air if/when the new flat rate State Pension starts. So - if I can even save 25% of it from being at risk of being grabbed by the Government then that would help.

Dependant on how much I have "saved" in my pension "account" - then I might be looking to take back all of my SERPS pension savings now in fact.

bilbo51

Have you got a current State Pension forecast?

dunstonh

does anyone know the details as to how to withdraw any of the SERPS pension I have saved?

If you are over 55 and you are referring to contracted out benefits (not contracted in) then you can commence the pension at 55 onwards. Not earlier.

and am concerned that if I leave my SERPS pension sitting there in "savings" then I may find that it vanishes into thin air if/when the new flat rate State Pension starts.

That is probably as likely as aliens landing in Milton Keynes.

then I might be looking to take back all of my SERPS pension savings now in fact.

you cant

ceridwen

bilbo51 wrote: »

Have you got a current State Pension forecast?

Yep...somewheres ...I know I have.

If the question is "Would your Basic State Pension and SERPS pension between them come to more than £140 per week?" - the answer is "Possibly - I need to check - but either way - its savings I've made by paying-in part of my salary over however-many-years...so I am looking to maybe take those savings back out again."

ceridwen

dunstonh wrote: »

If you are over 55 and you are referring to contracted out benefits (not contracted in) then you can commence the pension at 55 onwards. Not earlier.



That is probably as likely as aliens landing in Milton Keynes.



you cant

Re the "cant take SERPS pension back out again right now"....I know this financial advisor (in the Daily Telegraph newspaper) did exactly that (with 25% of his SERPS pension anyway). So - has the door closed to doing what he did now? He took this 25% out at age 50 (ie it would be 55 these days...).

Do you have "chapter and verse" to hand about the possibilities on withdrawal of SERPS before State Pension Age?

jem16

ceridwen wrote: »

Re the "cant take SERPS pension back out again right now"....I know this financial advisor (in the Daily Telegraph newspaper) did exactly that (with 25% of his SERPS pension anyway). So - has the door closed to doing what he did now? He took this 25% out at age 50 (ie it would be 55 these days...).

Can you clarify where your SERPS/S2P entitlement is? Have you contracted out of the additional pension and it is being paid into a personal pension or are you simply talking about the additional pension that you have built up?

If you have contracted out into a personal pension then you can access it at age 55 and take 25% tax free lump sum and an annuity with the rest. Although at age 55 this is unlikely to be a good deal.

If you have not contracted out you cannot get it until state pension age.

bilbo51

ceridwen wrote: »

Yep...somewheres ...I know I have.

If the question is "Would your Basic State Pension and SERPS pension between them come to more than £140 per week?" - the answer is "Possibly - I need to check - but either way - its savings I've made by paying-in part of my salary over however-many-years...so I am looking to maybe take those savings back out again."

Something like that...

You'll get better answers if you can provide the numbers.

Loughton_Monkey

ceridwen wrote: »

......- but either way - its savings I've made by paying-in part of my salary over however-many-years...so I am looking to maybe take those savings back out again."

Here you are entirely misinformed.

Firstly, a Serps Pension is 'Investment' not savings.

Secondly, because it is a 'pension' it is not yours - but it is held in trust for your benefit (there's a difference). That is why you can't simply stroll in and 'withdraw' your savings... As has been said, what you can do at age 55 is 'crystallise' the pension. This means you could take the 25% tax free lump sum. The remaining 75% must be taken some time as a form of income. There are several ways of doing this but for 90% of people, this simply means taking the annuity.

Thirdly, if it is (as you suggest) a Serps Opt-Out arrangement, you never paid in part of your salary. You chose to pay a reduced National Insurance Contribution, and in return, HMRC deposited money into the pension on your behalf.

If you are still working, and wish to take your pension now, then I would suggest you fully review the tax implications. It could be the worst thing to do.

Finally, I would say that the whole concept of the new £155 pension reamins just a concept, with only a few bits of meat on the bones. One of the big questions is the status of those who 'opted out'. Whilst nothing has yet emerged on this point, I would strongly suggest that you do not fall into the trap of thinking that the Government will create one rule for those who opted and and have crystalised their pension already, and those who opted out but have still not crystalised it. They are not stupid.