paid up pension charge

oops_a_daisy

I have just been looking into a pension that was paid up many years ago with Scottish Life ( following the tip in Martins E mail on de mutualisation ) anyway when this policy was made paid up I was told that I could just stop making payments and then it would be made paid up and carry on running till retirement without regular contributions ( although I was told that I could put in lump sums if I wanted to). The statement that I happened to pull out was when the policy was made paid up and I have just noticed that I was actually charged over £3000 to make it paid up ??? nobody told me that I would be charged to make it paid up nor was I warned that such a large amount would be taken from the fund.
Can anybody give me any advice on this ?

thanks for reading

dunstonh

and I have just noticed that I was actually charged over £3000 to make it paid up ???

That is highly unlikely.

A reduction is possible if it is a conventional with profits plan with a guaranteed sum assured to which bonuses are added to. However, all their other plans have no such charge.

nobody told me that I would be charged to make it paid up nor was I warned that such a large amount would be taken from the fund.

Did you ask anyone?

Can anybody give me any advice on this ?

Scottish Life have no reason to tell you anything unless you ask for the information. If you take on the role of adviser by doing things yourself, then the responsibility is with you for your actions. You should have ascertained the costs before making that decision.

My guess would be that it's either Scot Life giving you the transfer value instead of the current value and you are mistaking that as a penalty you have paid or a reduction in guaranteed sum assured if it was a conventional with profits plan. If it was the latter, then its probably cost you a bit more as that type of plan would typically have guaranteed annuity rates in double figures which on a £100k fund, it worth around £140k in a fund without them.

oops_a_daisy

Hi Dunstonh and thanks for the reply.

It was a with profits personal pension that my employer at that time also made payments into as well as my NI contributions. It was made paid up in 1994 and on the statement that I pulled out it stated 01/07/94 Paid up charge -3024.99 :eek: . I havent looked at this paperwork in years and obviously didnt look at it at the time :rolleyes: . At the time I tried to close the pension and get my money back out of it because money was very tight but I was told to just stop making payments and it would be made paid up ( and obviously that I couldnt just close it and get my money back out till it matured). I didnt ask if I would be charged to make it paid up as I didnt realise that I would be charged such a ridiculous amount. Lesson learned.

The last paragraph of your reply just went straight over my head sorry

I do try to look after my finances a bit better now thanks to MSE

edited to add that the pension was taken out through a financial advisor from Barclays and advice to make the plan paid up came from the same financial advisor