MVR Applied at retirement date by Phoenix

spakkaman

Would welcome some advice.
My wife turns 60 in July and she has just received a retirement pack from Phoenix. The pension is a with profits unloaded by NPI with whom it started decades ago.
The statements have shown the fund slowly growing in value today's £5.3k - approx. 3.5% per annum over the last 5 years. The plan has always had a retirement age of 60. I have held off moving the monies into her SIPP as I knew an MVR would apply but expected it to OK to move at 60.
So I was surprised to see an MVR has nevertheless been applied and that the MVR free date mentioned is actually 5 years later when she will be 65. The MVR being applied now is £1283.08 and this means the Pension on offer today is just £4,108.76.
This seems unfair to me. Can they really do this when it was always a retire at 60 product?

JoeCrystal

What was the original terms and conditions of the policy in question? They can depending on the terms and conditions.

lisyloo

Mine is 65.
I took it out in 1994 when my state pension age was 60 I.e. before the 1995 changes.

Are you sure it was for age 60 Ie. Do you have documents saying that?

dunstonh

MVR is not normally charged by NPI at the original scheme age. So, refer to the original documentation.

Maybe you think it was 60 but it wasnt at point of sale. Maybe its an error. If you can see the original policy schedule and it says 60, then you can go back to them and use that to get them to correct it.

ffacoffipawb

A 23.8% MVR seems a bit on the high side. Is it invested in the (unitised) WP fund that has a guaranteed bonus rate of 4%?

lisyloo

ffacoffipawb wrote: »

A 23.8% MVR seems a bit on the high side. Is it invested in the (unitised) WP fund that has a guaranteed bonus rate of 4%?

I’ve got that one. Last time I checked it was 28%, so that sounds about right.

ffacoffipawb

lisyloo wrote: »

I’ve got that one. Last time I checked it was 28%, so that sounds about right.

Would not expect a MVR at normal retirement age though. Makes the 4% bonus meaningless if they can take it all back at the end with an MVR.

spakkaman

ffacoffipawb wrote: »

A 23.8% MVR seems a bit on the high side. Is it invested in the (unitised) WP fund that has a guaranteed bonus rate of 4%?

I am very certain that there are no guarantees.


I will check the docs and re post shortly re Normal Retirement Age etc. I wanted to get a steer from the cognoscenti on here before attempting Phoenix as my hopes of a proper and clear response from them are low and forewarned is forearmed.


I really appreciate the responses above. Thank you.

lisyloo

ffacoffipawb wrote: »

Would not expect a MVR at normal retirement age though. Makes the 4% bonus meaningless if they can take it all back at the end with an MVR.

I am not sure what you mean by “normal” retirment age.
Do you mean state pension age?

My MVR applies until 65, my SPA is 67 but my SPA was 60 in 1994 when I took out this product, so I’ll follow with interest as it looks like the same applies in my case I.e. SPA of 60 (when sold) but MVR until 65.

Spakkaman can you please update when you find out one way or the other.

Dox

lisyloo wrote: »

I am not sure what you mean by “normal” retirment age.
Do you mean state pension age?

Pretty sure the poster meant 'original' retirement age (i.e. the age to which the policy was originally written) - no other sensible interpretation.

wjr4

lisyloo wrote: »

I am not sure what you mean by “normal” retirment age.
Do you mean state pension age?

My MVR applies until 65, my SPA is 67 but my SPA was 60 in 1994 when I took out this product, so I’ll follow with interest as it looks like the same applies in my case I.e. SPA of 60 (when sold) but MVR until 65.

Spakkaman can you please update when you find out one way or the other.

It's got absolutely nothing to do with the State Pension Age.