Ex aviva staff pension transfer offer

terminus6969

Hi

As a young person I worked at Norwich Union

I was only there a very short time so I can't understand why the staff pensions team have offered me £72k in lieu of benefits?

It says amount included in transfer value in respect of protected rights is £49k which relates to service before 6 April 1997

But my pension scheme entry date was 01/10/89 and I left 31/05/93

I was only earning probably up to £15k

So how come it's so much to transfer

It looks like I should take the money and transfer into another personal pension ? Any thoughts hugely appreciated!!

Thanks

Richard

dunstonh

So how come it's so much to transfer

1 - it was a good scheme
2 - it involved being contracted out of the additional state pension (so you get less state pensions)

It looks like I should take the money and transfer into another personal pension ?

What are the other options?
Are they winding up the scheme or did you ask for this information?

sandsy

Have they given you any indication what the benefits would be if you didn't transfer?

terminus6969

Hi

No I just asked for a current valuation and received the info

Thanks

Richard

terminus6969

The deferred statement says

GMP £205.40 pa

A pension of £731.60 pa which will be increased for each complete year between date of leaving and date of retirement

Final pensionable salary £15,319

WobblyDog

I'm no expert, but: The date 6 April 1997 suggests that your scheme could include a GMP (Guaranteed Minimum Pension) component: https://www.barnett-waddingham.co.uk/comment-insight/blog/2014/08/18/what-is-a-gmp/

If so, your pension *might* have been re-valuing at up to 7% per year. Assuming you were in a "1/60th" scheme, your pension in 1993 values would have been maybe £900 per year. If it's been rising at 7% per year, it could be worth about £4200 in today's money, and might keep on revaluing until you retire. Your decision will depend on all sorts of things, but £72K doesn't sound particularly generous to me.

dunstonh

No I just asked for a current valuation and received the info

In which case, the other statement you made....

It looks like I should take the money and transfer into another personal pension ?

....would almost certainly be the wrong thing to do.

xylophone

Does the Aviva Scheme use fixed rate to revalue GMP?

If so the GMP not the whole pension is revaluing at 7%

The excess over GMP revalues differently.

https://www.barnett-waddingham.co.uk/comment-insight/blog/2012/07/24/revaluation-for-early-leavers/

The OP should consult the scheme booklet.

If he wanted to transfer out of this DB scheme, he would require the advice of an IFA with the necessary qualification and permission.

http://www.fca.org.uk/firms/financial-services-products/investments/pension-transfers

It is unclear whether the pension of £731.60 is exclusive or inclusive of the GMP.

The GMP is all post 88 and at GMP age (60 female /65 male) must be increased in payment by CPI up to 3%.

The OP should get a state pension statement after 6 April to show the position with regard to his deduction for contracting out.