Deferred Pension

trevs7

I was made redundant last year and I therefore have a deferred pension with 18-years service. I am now working for a new company and have started a new pension with them.

The good thing about my deferred pension is that I can draw it from age 50 onwards, which is something I may consider as a good option is 5-years time.

However, I have just received a "Summary Funding Statement" for the deferred plan and I was shocked to see that the "Winding Up" position shows that the value of the plan assets has a shortfall of 51%.

Should I be looking to move to another pension provider or is this figure no reason to panic? If I should move, can anyone recommend a good IFA who specialises in this issue?

Many thanks in advance for any help.

EdInvestor

Have a talk to these people:

http://www.pensionsadvisoryservice.org.uk/

jonathon_hart

Have you been informed that the scheme is actually winding up? If not then it is a reason to be concerned, but not to panic.

Sometimes these sorts of things are put on to give an idea of the funding position of the scheme. What it will mean is that if the scheme were to be wound up and all the members forced to transfer out then there is currently enough money in the scheme to cover 49% of the cost. Don't forget though that this is a snapshot and may be a couple of years out of date as Final Salary schemes are only obliged to do a valuation of assets vs liabilities (i.e. amount of pensions within the scheme) every 3 years. Therefore the employer may have already made or be planning to make correctative action in the form of higher contributions.

One thing to watch and check with the administrator is that transfer values may be reduced because of this.

You need to check with the administrators to confirm the exact situation and if you wish to consider transferring consult an IFA. If you want to find an IFA to discuss this then you can find one at www.unbiased.co.uk.