Flexi drawdown not available

saver_ali

My husband retired just over a month ago, and we are in the process of putting our pension withdrawal plan into action.

There was a minor spanner thrown into the works yesterday as it appears the pension plan from his last employer doesn't offer flexi drawdown. We were sent a pack with his options, which were either an annuity or UFPLS.

The plan is operated by Mercers, and when we spoke to them yesterday they couldn't say conclusively whether or not it was available. She just said that the options would have been checked when the pack was prepared, and if flexi drawdown wasn't offered then it wouldn't have been available.

I find this very hard to believe of a modern pension. His ex-employer is a major corporation, and this plan was only set up in 2018. I've checked over all the paperwork from when the new plan was introduced (investments from the old plan were transferred across), and there is no mention of withdrawal options.

It's not the end of the world, as we'll just transfer it to his SIPP.

Any thoughts as to whether this is likely to be correct, or whether it's worth going back to Mercers? I have to say that I haven't found Mercers to be very helpful in the past (his DB is administered by them too).

Thanks.

wjr4

Mercer do not offer Flexi-Access Drawdown so he would need to transfer it.

dunstonh

I find this very hard to believe of a modern pension.

Most occupational pensions do not offer it. A number of retail individual pensions dont offer it.

Workplace schemes are designed to be simple. That means they usually lack quality, features and options that introduce complications.

When the time is due you just transfer it to a retail personal pension or SIPP that does drawdown and has the features and options you are after.

saver_ali

Thanks both of you for the clarification. Much appreciated.

tacpot12

If they offer regular UFPLS payments, why not take those. 25% of the payment is tax free, and the remaining portion as taxed as income. Dead simple.

saver_ali

tacpot12 wrote: »

If they offer regular UFPLS payments, why not take those. 25% of the payment is tax free, and the remaining portion as taxed as income. Dead simple.

In some circumstances that would be fine, but not for us. We need to crystallise it completely now before the investments grow, as my husband is getting close to the LTA.