What is "retirement"?

tgon

Ive a very old, very small stakeholder pension (<£700 pot) that I wish to "cash in" as I'm now over 55. This is probably a stupid question but is it just a simple matter of notifying the trustees that I wish to "retire" even though I am still in full time employment elsewhere? Just made me wonder if retirement before 65 is a commitment to cease all work or a selective "retirement" to free up some minor funds? Thx

Aegis

Retirement has at least 4 different meanings depending on whether you ask the government, your employer, your pension provider, or the man in the pub (you could also ask family or even yourself if you prefer).

There is no law requiring you to actually cease work before claiming your pension.

Presumably you have other pensions elsewhere, as a £700 pension isn't going to go far towards providing your retirement income!

molerat

You will not be able to "cash it in" until 60. You should be able to take it as a pension now or transfer it to another one. Retirement (as in commence taking some or all of your non-state pensions) is what you want it to be, anyone over 55 can do it.

tgon

molerat wrote: »

You will not be able to "cash it in" until 60. You should be able to take it as a pension now or transfer it to another one. Retirement (as in commence taking some or all of your non-state pensions) is what you want it to be, anyone over 55 can do it.

I'll wait another four years. A lump sum is worth more to me as a 60th birthday present then a negligable pension now. I've looked at transfering twice in the past but the cost of transfer is nearly the total amount.

Mojisola

Do you have any other private pensions? You have to have a pension pot of under £18,000 to use the triviality rules.

molerat

Mojisola wrote: »

Do you have any other private pensions? You have to have a pension pot of under £18,000 to use the triviality rules.

If the pot is less than £2k you can take it all under stranded pots regs, I have one with £600 in and am leaving it there for the next 2 years.

http://www.scottishwidows.co.uk/Extranet/Literature/Doc/FP0285 an interesting paragraph on how to legally abuse this

tgon

Mojisola wrote: »

Do you have any other private pensions? You have to have a pension pot of under £18,000 to use the triviality rules.

I've about £120k pot in other pensions and trying to work out when my earliest break-even retirement age is. This stranded pension is just me trying to tidy up.

ffacoffipawb

molerat wrote: »

If the pot is less than £2k you can take it all under stranded pots regs, I have one with £600 in and am leaving it there for the next 2 years.

http://www.scottishwidows.co.uk/Extranet/Literature/Doc/FP0285 an interesting paragraph on how to legally abuse this

Could you split a £100k fund into fifty £2k pots and take each of them all as cash under stranded pots regs?

(Just curious)

EDIT: No, according to link you can do it twice at most!

Freecall

Would it therefore be good pension planning for us all to create 2 'stranded pots' of just under £2k each at age 59?