Guaranteed Minimum Pension Query

nisadave

i am planning to take early retirement age (50 next year)my income would have been made up of 2 pensions ,one from my current employers scheme (Debenhams) and one from my previous employer (british steel/corus group).my current employer has confirmed my benefits can be taken however my previous employer has said that due to gmp rules i cannot now access benefits at this age .my question is this, Can the 2 pension funds be classed as one income level in order to meet the governments rules or is this an over simplistic view (both schemes were contracted out of serps)I am now contributing to a stakeholder scheme since debenhams closed its pension scheme last year.Can anyone give me any advice on how to get round this situation

MrChips

One solution might be to get a transfer value paid from your old to your current scheme. They are both contracted out. You need to check first whether you current scheme will accept it, and also whether there is enough excess pension above the GMP in your current scheme to allow the sum of the two reduced pensions to be high enough to cover the sum of the two GMPs from age 65.

edit - just reread that your new scheme is closed (presumably to future accrual?). In that case they probably won't accept the transfer in. You might be able to transfer both pensions to your Stakeholder and take early retirement that way. However whether this is a good idea or not is another matter. Financial advise needed.

nisadave

the debenhams scheme will no longer accept transfers from other schemes Can i transfer into my stakeholder scheme

MrChips

I think you could, if it is also contracted out. Not an expert on Stakeholder's though.

However, the terms for annuity purchase might not be as good as you would get in the original scheme. And depending on the relative levels of excess pension and gmp, you still might have difficulty taking retirement at 50.

dunstonh

If the original scheme contains GMP, then you will lose that benefit if you transfer to a stakeholder, personal pension or SIPP. The amount lost could range from very little to a significant amount.