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Final salary pension, aged 55

shelley17
Posts: 24 Forumite
I've started my own thread as I tagged my initial enquiry onto someone else's.
OH 55, laid off work due to workplace injury 7 ish years ago.
Has final salary pension. Trustees, who are also directors refused early retirement 4 or 5 years ago (when retirement age was 50) , saying it was detrimental to the fund AND other ex employees had asked for this but been refused?!
I thought at the time, we'd asked for ill health retirement , but looking at the way the paperwork was worded, we actually requested straight forward early retirement.
Give that it was refused, we waited until he hit 55, and asked the company for a guaranteed transfer value, and also whether they'd now consider early retirement.
We eventually got GTV but still waiting to hear about early retirement ( it's been nearly four months now).
We fully expect the company to give the same reasons for refusal again, and , as before, take nine months to do so.
I was given some great advice here and it was suggested we use the grievance procedure to get a response.
In the meantime, we had an appt with an IFA, and as expected, he said we should proceed first with the option of drawing directly from the company.
We asked him whether this was something he could do on our behalf, as we really dont want to deal with the trustees and he said possibly.He'll get back to us.
I suggested, maybe he could agree a fee, and if the company refused again, could he then justify a transfer out of the scheme.
I also asked whether trustees, after refusing early retirement could then also refuse a transfer.
He needs to get back to me. He was very concerned about the FCA and his licence etc, which has left us somewhat confused.
I do fully appreciate an IFA has to give the best advice for us, but surely if the company won't allow (I'm assuming they won't) early retirement, then a transfer with an annuity can be justified given our financial situation and the fact my husband is virtually unemployable due to his health and age, so works self employed doing whatever he can.
Under these circumstances, could the trustees block a transfer ?
Sorry for long post, but it's incredibly frustrating having saved for over 30 years, desperately needing to draw an income and not being able to get our hands on it.
OH 55, laid off work due to workplace injury 7 ish years ago.
Has final salary pension. Trustees, who are also directors refused early retirement 4 or 5 years ago (when retirement age was 50) , saying it was detrimental to the fund AND other ex employees had asked for this but been refused?!
I thought at the time, we'd asked for ill health retirement , but looking at the way the paperwork was worded, we actually requested straight forward early retirement.
Give that it was refused, we waited until he hit 55, and asked the company for a guaranteed transfer value, and also whether they'd now consider early retirement.
We eventually got GTV but still waiting to hear about early retirement ( it's been nearly four months now).
We fully expect the company to give the same reasons for refusal again, and , as before, take nine months to do so.
I was given some great advice here and it was suggested we use the grievance procedure to get a response.
In the meantime, we had an appt with an IFA, and as expected, he said we should proceed first with the option of drawing directly from the company.
We asked him whether this was something he could do on our behalf, as we really dont want to deal with the trustees and he said possibly.He'll get back to us.
I suggested, maybe he could agree a fee, and if the company refused again, could he then justify a transfer out of the scheme.
I also asked whether trustees, after refusing early retirement could then also refuse a transfer.
He needs to get back to me. He was very concerned about the FCA and his licence etc, which has left us somewhat confused.
I do fully appreciate an IFA has to give the best advice for us, but surely if the company won't allow (I'm assuming they won't) early retirement, then a transfer with an annuity can be justified given our financial situation and the fact my husband is virtually unemployable due to his health and age, so works self employed doing whatever he can.
Under these circumstances, could the trustees block a transfer ?
Sorry for long post, but it's incredibly frustrating having saved for over 30 years, desperately needing to draw an income and not being able to get our hands on it.
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Comments
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To sum up, you asked for early payment, trustee said no as it would cost them, you thought about transferring out but the IFA said it would be a bad idea so wouldnt sign of on it.
Can the benefits not be reduced for early payment thus no employer cost? Failing that is ill health from deferred status not permitted in the scheme? That would be unusual.
If not wait, dont transfer out it will cost you in the long term0 -
Thanks Drp8713 in a nutshell, yes ! I've no idea about taking reduced benefits for early payment as the IFA didn't mention this as an option.
Ill health is permitted, but again the scheme rules aren't detailed enough. We've asked for a copy of the exact wording of the rules relating to this, it's just getting them to supply it.
In the handbook, it says "with the agreement of the company and the Trustees you can retire any time after your 50th birthday ( OLD booklet ! )
or earlier if you are seriously ill or incapacitated. "
Interestingly, the Pensions Ombusdman site states that the courts consider incapacitated to mean you can no longer do your original job.
So, I guess we really need to see the full wording. Ironic though that they can legally lay him after after 30 years service, and still be difficult about giving him his pension.
The problem is, the trustees will do all they can legally to stop him getting money by any means. They never reply to letters, we have to repeatedly chase them up.
Thanks for taking the time to answer, much appreciated.0 -
Have you a copy of an up to date handbook?
What does it say about taking a pension after 55 but before NRD?
Does it give the actuarial reduction factors?
Are there any details of taking a deferred pension before NRD on grounds of ill health?0 -
Hi xylophone
It's an old booklet and says you can retire after 50 (I know should now read 55) with trustees consent, or earlier of incapacitated, but it doesn't go into detail.
We did apply when law was 50, but they refused. There's nothing about actuarial reduction factors.
The trustees have always been difficult, for example, when the company scheme was closed, including all existing employee members, we had no idea. We only found out years ago when we asked for a transfer value.
I've asked for exact wording of both early and ill health, but suspect they'll give me the runaround again, and then we'll have to go through the grievance procedure.
We've asked four months ago about early retirement, followed it up again last week, but they just ignore !0 -
He needs to get back to me. He was very concerned about the FCA and his licence etc, which has left us somewhat confused.
Trying to read between the lines, but does the adviser have permissions to advise on Occupational Pension Transfers?
Advising in this area requires specific permissions from the FCA, which the majority of advisers do not hold - many because they do not hold the specialist qualifications in this area, but also many simply do not want to get involved with this type of business because of the risk.
If the adviser doesn't have Pension Transfer permissions, he shouldn't be advising on whether or not this is suitable.I work for a financial services intermediary specialising in the at-retirement market. I am not a financial adviser, and any comments represent my opinion only and should not be construed as advice or a recommendation0 -
It's an old booklet
Is there an up to date version available on the internet perhaps?0 -
Then your only recourse is to write a letter to the Trustees explaining your situation and asking whether consent will be given for an actuarially reduced pension or for the deferred pension to be paid early on grounds of ill health?
Remember that getting an IFA to sign off the transfer of a deferred FS pension might be quite difficult.0 -
I'm a pension fund trustee rather than a pensions expert, but for our scheme we have an internal dispute resolution policy. If they are unable to provide you with the evidence you need, can you escalate to this? If you can prove that you've tried this and still not achieved a resolution, I think you can then refer to the Pensions Ombudsman. That's how it would work in my small scheme anyway, though thankfully we've been able to resolve before IDRP, let alone Ombudsman.Please stay safe in the sun and learn the A-E of melanoma: A = asymmetry, B = irregular borders, C= different colours, D= diameter, larger than 6mm, E = evolving, is your mole changing? Most moles are not cancerous, any doubts, please check next time you visit your GP.
0 -
Thanks bm78
That's what I'm wondering, although I did explain over the phone what kind of scheme it is and what we wanted to achieve , prior to setting up the appointment.
I'll just have to wait and see what he comes back with.
I thought OH could sign a waiver of some sort for an IFA, confirming he understands that he'll lose a lot of money by transferring, but still wants to go ahead despite professional advice given.
We've got an old funding statement from trustees that says "if the scheme winds up, we would buy out the schemes pensions with an insurance company, in these circumstances you might not get the full amount of pension you have built up or continue to receive your pension at its current level, even if the scheme is fully funded"
Ex employers will almost certainly wind up the scheme before OH is 65. They've cut working hours and are running on minimum staff.
So, even if we could afford to leave it, which we can't, there's still a huge risk involved in keeping it.0
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