Protected rights and Guaranteed Min Pension

Your_Hero

green_man wrote: »

Right - Yes I've read the links in your post and I'm just as confused. The GMP in my statement seems to be defining a Minimum Pension pot rather than a Minimum pension. My company scheme was never a DB scheme it was always DC. It may have been a COMP scheme, in which case the pot should be available to me from 55?

What questions would I need to ask of Pheonix?

Ask them
(1) what type of pension it is, e.g. Section 32, or Personal pension or other?
(2) Is there really a GMP on the plan?

You've mentioned it several times that it has a GMP and at age 65, and so it may suggest it is probably an S32. Best to find out and post back to update us.

green_man

Ok - Many Thx. I'll ask these questions and see what they say (if they respond at all)

mgdavid

green_man wrote: »

Ok - Many Thx. I'll ask these questions and see what they say (if they respond at all)

phone them up...

green_man

I just phoned Phoenix - I must say they were extremely helpful.

It seems I have miss-lead you slightly, this policy does not have a GMP. It has a Minimum Guaranteed Sum.
This is not Section 32 it is just a personal pension that previously had direct contributions as well as NI rebates paid into it.

So apparently I can do whatever I want with these pots from when I am 55 (hurray). Obviously I will not get the full Guaranteed value if I do that (as this value was if taken at 65). But given the guarantee is a 50% increase in the current pot for leaving it another 16 years then that guarantee is not that valuable.

Current transfer value for the two pots combined is £92K, currently Pheonix do not know what draw-down options they will provide so I may need to transfer if I go down that route.

greenglide

But given the guarantee is a 50% increase in the current pot for leaving it another 16 years then that guarantee is not that valuable.

Have I understood you right? A 50% increase (effectively a terminal bonus?) is not valuable. Really?

green_man

greenglide wrote: »

Have I understood you right? A 50% increase (effectively a terminal bonus?) is not valuable. Really?

No thats not it. The protected rights pot is worth £62K now. In 2031 it is guaranteed to be worth at least £95K. So they guarantee to give me 50% on top of the current value in 16 years time. i.e. they guarantee at least 50% growth in 16 years. Any such terminal bonus is not considered in the above (I believe the current terminal bonus is minimal).

I'm not saying I definitely wont hold out until 2031 it's just the guarantee isn't that great as to make it a no-brainer.