Defined Benefit Deferred Pension

JacksonM

I have a Defined Benefit Deferred Pension with a company that I no longer work for.  I am over 55.  I've been told that I need to get a CETV which I will do but, I want to know if it possible for me to take the whole value or some of it to invest myself if I transfer it out to some other type of scheme or investment? 

Linton

It is possible to transfer some DB pensions to a personal pension but it is not a simple, cheap, or for many people, a sensible thing to do.  Most government pensions cannot be transferred. If transfer was possible you would only be able to transfer all or none of it.  Is the CETV likely to be more than £30K?  If so you will need to pay for a suitably qualified IFA to review your situation and come up with a recommendation. - more info available on request.

If you had already done this how would you have coped with a 30% drop in the pension value, such as could have happened over the past 2-3 weeks?

JacksonM

I honestly don't know the value, it is probably under 30k but from what you say, it sounds as though requesting any lump sum after CETV or, trying to invest it into something else would either not be allowed or a bad idea....

Thrugelmir

JacksonM said:

I have a Defined Benefit Deferred Pension with a company that I no longer work for.  I am over 55.  I've been told that I need to get a CETV which I will do but, I want to know if it possible for me to take the whole value or some of it to invest myself if I transfer it out to some other type of scheme or investment? 

What do you consider the benefit to be of transferring out? When you are guaranteed, a secure increasing income for life. 

JacksonM

I was hoping to take some in the form of a lump sum and look at re-investing the rest.

JoeCrystal

JacksonM said:

I honestly don't know the value, it is probably under 30k but from what you say, it sounds as though requesting any lump sum after CETV or, trying to invest it into something else would either not be allowed or a bad idea....

How much is the deferred pension?

Linton

JacksonM said:

I honestly don't know the value, it is probably under 30k but from what you say, it sounds as though requesting any lump sum after CETV or, trying to invest it into something else would either not be allowed or a bad idea....

Unless it is a government pension, under £30K is easier as you dont need an IFA recommendation.  What you would do is to get somewhere to transfer into, transfer the whole lot and then drawdown 25% as a tax free lump sum.  The problem with trying to invest into something is that unless you have some experience (or even if you do have) the result could be worse than if you had simply kept the DB pension.

For a very small pension (£30K CETV could represent perhaps £1K/year pension) is it worth the effort?

Thrugelmir

JacksonM said:

I was hoping to take some in the form of a lump sum and look at re-investing the rest.

What opportunities have you identified, that you consider will provide a decent investment return at the current time? 

Albermarle

I honestly don't know the value, it is probably under 30k

You might be surprised at the size of it . Your current pension will give you a guaranteed income for life from when you can take it . The cost of funding this is higher than most people expect.

First you need to find out what benefits your pension offers you now. Then find out the CETV . Not the other way around.

Dox

Linton said:

 If transfer was possible you would only be able to transfer all or none of it.  

Some schemes allow partial transfers.

JacksonM

I haven't identified any opportunities - just thinking about it at the moment.