Section 32 Buyout Plan with GMP

Poppy_Golightly

I thought that with the new pension 'freedoms' from April that this applied to my Section 32 Buyout Plan with GMP. My pension provider Clerical Medical says i can't cash it in.

As far as providing a GMP the amount that is in the fund is so paltry I doubt if it would fund an ice cream let alone a pension. However the amount if I could get it out would make a big difference to me at present as I have been diagnosed with Breast Cancer and extra money would be very beneficial at the moment.

So my query is basically is there anything I can do to cash it in? And if I can't and there is not enough to fund a GMP am I right in thinking that they have to make up the shortfall. They tell me that if there isn't I have to wait a further 5 years, surely they are trying to wriggle out of making up the shortfall?

Thanks in advance for any advice you can give

xxxx

dunstonh

I thought that with the new pension 'freedoms' from April that this applied to my Section 32 Buyout Plan with GMP. My pension provider Clerical Medical says i can't cash it in.

The "freedoms" are rules which providers can choose to implement or not.

Clerical Medical is closed for new business and you wont see much, if any investment in bringing the new options to legacy contracts.

As far as providing a GMP the amount that is in the fund is so paltry I doubt if it would fund an ice cream let alone a pension. However the amount if I could get it out would make a big difference to me at present as I have been diagnosed with Breast Cancer and extra money would be very beneficial at the moment.

It is still possible but would require transferring to a pension that would allow it. It may be required that you get an adviser to sign off on it. There are consequences of this too as you would lose the GMP and any other guarantees that exist. This can potentially impact on your state pension too.

And if I can't and there is not enough to fund a GMP am I right in thinking that they have to make up the shortfall.

Correct. Hence why it is called a guaranteed minimum pension.

They tell me that if there isn't I have to wait a further 5 years, surely they are trying to wriggle out of making up the shortfall?

These things are set in legislation. Its not about wriggling out of meeting the GMP. In fact, they would be very happy for you to transfer out. It would save them money. I assume you are 55 currently, hence the 5 years?

Poppy_Golightly

Thanks for such a quick and detailed reply.

My retirement date on the plan is October this year when I reach 60 (gulp!)

xylophone

https://forums.moneysavingexpert.com/discussion/comment/67941173#Comment_67941173

Post 7 might be of interest.

GMP age for females is 60.