National Grid Deferred Pension

jcorbygas

I have a National Grid Deferred Pension which will be payable in 3 years (60 years old) Due to our retirement plans I am thinking of transferring it so that I can take a lump sum now - at the moment the index linked annual pension I would get is £9000 per year - has anyone any ideas what the transfer value might be from their personal experiences - I am awaiting a reply to this from National Grid but they are taking their time.

Thank you

mgdavid

If the Nat Grid is a Defined Benefit pension then what you propose is almost certainly the wrong thing to do and will cost you a lot of lost income in retirement.
If you have other very generous pension provision or much alternative wealth / savings / investments then it might be OK.

jcorbygas

I know all about the tax implications regarding this - I was making an enquiry to get the actual figure so that I can plan for our future - there are a lot of other factors involved in my personal situation, but thank you for pointing out the pitfalls for others

C_Mababejive

The pension scheme admin will gladly provide you with a transfer out value..

dunstonh

has anyone any ideas what the transfer value might be from their personal experiences

Historically, it would likely be a figure that has little chance of providing £9k indexed annual income.

Gilt yields are distorting CETVs at present but statistically, the transaction you are looking at has historically only been suitable for around 1 in 10 cases.

xylophone

https://www.nationalgridpensions.com/396/716

You have checked the links?

http://www.professionaladviser.com/professional-adviser/feature/2413093/pension-transfer-rules-everything-advisers-need-to-know

https://www.moneyadviceservice.org.uk/en/articles/transferring-out-of-a-defined-benefit-pension-scheme

Expect to shell out a large wad for advice from a pension transfer specialist if you go down this route.

And don't expect an automatic recommendation to do it....

jcorbygas

We have now received info from BG - They have advised that the transfer value is £315000. The annual pension from age 60 is just over £9000 per year at the moment.
We will be taking advice from an adviser but would like clarification as well before going further as to whether we understand this correctly.
First of all if we decided to do the transfer does it have to be before the annual pension starts in 2018.
If we want to transfer into a personal pension, does this mean that after that has happened we can take up to 25% of this in a tax free lump sum, leaving the remaining sum invested for a reduced pension.
If the £9000 pension started when I am still working as self employed then this will be counted as going towards my annual income and I will be taxed on this at the appropriate rate? so anything over £42000 will be taxed at 40%

dunstonh

Please do not respond tot he post by JamesKevill. He has been reported to the board.

if people could take screen shots of his posts and forward them onto the consumer.queries@fca.org.uk stating that this person is in breach of FCA guidelines then if enough do it, the FCA will investigate. In this case, it is a financial promotion breach.

kidmugsy

jcorbygas wrote: »

First of all if we decided to do the transfer does it have to be before the annual pension starts in 2018.

Yes

jcorbygas wrote: »

If we want to transfer into a personal pension, does this mean that after that has happened we can take up to 25% of this in a tax free lump sum, leaving the remaining sum invested for a reduced pension.

Yes

jcorbygas wrote: »

If the £9000 pension started when I am still working as self employed then this will be counted as going towards my annual income and I will be taxed on this at the appropriate rate? so anything over £42000 will be taxed at 40%

If your total annual taxable income exceeds approx £42k, the excess will be taxed at 40%, yes. But you will be in charge of how much to draw every year. And you can avoid 40% tax by making pension contributions.