Closing a works pension-please help

chada_2

I was working for Motorola for 5 years in which time i contributed to a company pension.When i was made redundant i was told that anyone who had paid into it for more than 2 years could not have their money out but could only transfer it to another pension.My question is,is there any way of getting my money out? as its only a few grand and i would rather spend it on something else rather than wait 30 years for £700 per year(thats what ive been told)If i transfer to a private pension then close that can i get my money that way?
The pension has been frozen now for 6 years.

I would be grateful for any help.

Thanks

jem16

I doubt you would be able to get at it by transferring or everybody would be using that loophole.

I'm guessing that it's the final salary Motorola pension as opposed to the later introduced Money Purchased scheme?

If so you may be wise to leave it where it is as is often the case with final salary pensions rather than transfer. At least the amount will rise with inflation as it's index-linked.

jonathon_hart

Hi.

Sorry but you can't. Due to legislation then once you have been in the pension scheme for more than 2 years then the pension is legally preserved until you retire.

Also transferring it does not allow you to access the money.

If anyone says you can then it is either a con, a loan on the promise of repayment when you retire, or illegal.

Thanks

Jonathon

dunstonh

You cannot close a personal pension. If you transferred it and excercised the cancellation rights the money would be returned to the previous scheme or another pension scheme. It stays the system.

The 2 year rule isnt really a rule now either as many schemes have cut that down just to a few months.

Whoever is giving you the information doesnt know what they are talking about. There are a lot of myths and misinformation relating to pensions. Especially in the workplace.

jonathon_hart

2 years remains the longest time to stay in a pension before the scheme is obliged to offer a preserved pension. If the scheme wishes to offer a preserved pension for members with less than 2 years then they are perfectly entitled to, but that is the scheme's choice not legislation. This has always been the case (My work scheme was offering an immediate preserved pension when I joined it in 2000)

The new bit that came in in 2006 is that for schemes with a 2 year period before a preserved pension is offered they have to offer members with 3-24 months in the scheme a chance to transfer their benefits rather than automatically paying them out as they did before.

I have administered and worked on a scheme that uses these rules.

Thanks

Jonathon

TomD_3

Hi. Hope someone can offer some advice regarding a work pension transfer.

I left my previous employer in April 2007 after 19 months' service and requested that my pension fund be transferred to my new employer's scheme. However I was informed by my new pension administrators that they could not accept transfers in until 2 years' service had been completed i.e. April 2009. I told my previous pension scheme about this but was advised that they could not keep my fund for this long and that the contributions would be returned to my old employer. Obviously I am not happy with this situation!

Is this related to the fact I was employed for less than 2 years? Is a possible alternative opening a personal pension, transferrring in from my old scheme and then transferring back out to my current employer's scheme in April 2009?

Any suggestions would be greatly appreciated...

dunstonh

why not get it transferred to a stakeholder pension and decide if you want to move it to the occ scheme later.

jonathon_hart

Hi. Yes this will be because you left with 3 to 24 months service so they can force you to transfer out. You do need to be quick as there is could be a time limit on how long you have. The minimum time limit is 3 months, but your scheme may offer more.