Pension Pot When Retiring

nxdmsandkaskdjaqd

I have a Defined Contribution pension and I am planning to retire shortly. I would like to know when you leave the Company do you have to take your pension pot with you or can it stay invested in the company scheme?

I would add that I have no plans to crystallise the pension for a number of years.

I am asking my pension scheme administrator the same question, but have not yet had a definitive reply.

AnotherJoe

I haven't heard of a scheme where you cannot leave it where it is. I think it would be vanishingly rare to be in such a scheme, if that's even legal, which I suspect it isn't, it would be wholly impractical to force people to move.

nxdmsandkaskdjaqd

Thank you.

xylophone

It seems to me that in your case, where you a re a member of a hybrid scheme, you would have to be permitted to leave the pension in the scheme because of the existence of the GMP underpin? Although a transfer to a S32 type arrangement might be permitted?

http://www.pruadviser.co.uk/content/knowledge/technical-centre/section_32/

jamesd

You can normally leave pension pots where they are until you start to take money out but some schemes don't allow it. Some have increases in charges of perhaps 0.5% a year for those who are not active employees and that can make it desirable to move the money.

This normal practice of pots staying where they are has meant that there are government proposals for "pot follows member" schemes that would reverse this and cause the pots to automatically move to the new pension wherever the new job is. The idea is to reduce the number of old small pension pots that people have lying around. Plans for this have been suspended for the moment in part due to all of the other changes there have been around pensions recently.

If you're in a section 32 scheme there are often protected benefits like a guaranteed annuity rate or guaranteed minimum pension and it's normally only permitted to move the money after receiving independent financial advice. In theory it's possible to move and preserve the rights but that sort of thing can't be done at an individual employee level. Since at least part of your scheme is defined benefit due to the GMP underpin it would be illegal to move without independent advice if the expected lifetime value of the benefits is more than £30,000. The illegality would be with the pension scheme, it would be breaking the law if it allowed the move without proof of advice.

It isn't illegal to leave the pension where it is.

atush

Ask your pension scheme.

you dont give enough information for anyone else here to say.

System

Hi

Imagine retiring, moving away, and not giving a forwarding address to your old employer or pension provider.

Then the pot stays put.

green_man

I 'retired' last year but cannot draw my defined contribution pot for another 5 years ( being 50 now). I have left it where it is as the charges are extreamly low but it does not support drawdown so will have to transfer it somewhere when I am 55.

The point being, you should be able to leave it where it is, and there may be pluses doing that.