Pension bee, yes or no?

di1965

Hi all, I have 2 deferred works pensions only adding up to about £10,000. I am thinking of using pension bee to combine them and them draw them as a lump sum. I am not very clued up so is this a reasonable idea? Any help will be great, many thanks in advance, Diane.

kuratowski

Hi Diane, there are many types of pension.  For this question, we need to know whether you have defined benefit or defined contribution pensions.  Do you know?  If not you can try and work it out using this tool https://www.pensionwise.gov.uk/en/pension-type-tool

wjr4

I think pensionbee an expensive pension! Where are your pensions now? Why can you not do this with your existing pensions? 

dunstonh

I think pensionbee an expensive pension! 

They are but when you consider the small value, then its less an issue.  

However.....

I am thinking of using pension bee to combine them and them draw them as a lump sum.

Why cant you draw them from where they already are?    With those values, the small pots rule should apply.

Brynsam

dunstonh said:

I am thinking of using pension bee to combine them and them draw them as a lump sum.

Why cant you draw them from where they already are?    With those values, the small pots rule should apply.

Not clear from what OP says as to whether these are actual pensions totalling under £10,000, in which case they are anything but 'small pots' ! Otherwise, if these are total cash values of her two pots, you are of course spot on.

di1965

Thank you for your help so far. Sorry to sound a little stupid but I am only going by what I have been told by my previous employers over the phone. I have been told that the rules of both pensions do not allow lump sum widthdrawls, one is worth £4000 and the other £6000, I should have made this clear at the beginning but I am new to this.

GunJack

di1965 said:

Thank you for your help so far. Sorry to sound a little stupid but I am only going by what I have been told by my previous employers over the phone. Both the pensions are defined benefit, one is worth £4000 and the other £6000, I should have made this clear at the beginning but I am new to this.

you need to check if they're £6k and £4k per annum, as if they are the transfer values are likely to be much higher than £10k. Ask both schemes for a statement of deferred benefits and a CETV (transfer value).

di1965

The amounts are taken from CETV last year.

Albermarle

OK now it is clear . They are both low value DB schemes ( presume you did not work for either employer very long ) and the last CETV values were £6K and £4K.
First point is that these values may have have changed in the meantime and you will need to get an update. Usually this is free as long as you do not ask too often.
If you transfer them to Pension Bee ( or similar) you can not take any money out at all until you are age 55 at least.
Also do you have any other pension/retirement provision? If not then would be better to think in terms of adding more money rather than taking it out.

di1965

Thank you, I am 55 in June and I have to access the cash asp for personal family reasons. Normally I would have left it alone but life doesn't always run smoothly does it.

Albermarle

You can take 25% tax free but the other 75% is taxable . If you are not working/not paying any tax then you should be able to claim back any tax taken .