Legal & General investment frozen

Tenby65

I have an L & G stakeholder pension , where some of the funds are invested in  a property fund . I have gone through all the form filling etc to release a partial payment from my pension and have been told I can not!!! My pension has been invested in other funds which are not suspended but I am still unable to release these . Any help would be appreciated 

dunstonh

Some providers or plans will releas the money on the funds that are not suspended but some providers cannot (it can be plan specific if there are safeguarded benefits involved).

 have been told I can not!!! 

What reason did they give?

Albermarle

Property funds cause these types of issues on a regular basis. Best to keep out of them if there is a possibility you might need the money at short notice . Hopefully will be back to normal within 6 months ?

MaxiRobriguez

Property funds often withhold withdrawals because the underlying assets aren't liquid enough to meet investor withdrawals.

Your other funds, presuming they're not invested in iliquid assets, shouldn't be put on hold. 

The_Green_Hornet

A similar thread can be found at https://forums.moneysavingexpert.com/discussion/6167002/legal-general-blocking-pension-transfers/p1 where a transfer was blocked due to property fund investment. There doesn't appear to be a resolution.

Albermarle

Different providers seem to have different ways of handling these suspended funds .
I have one in a Standard Life Pension and it seems that it would be OK to withdraw from the other funds . Also if the pension reached its selected retirement date and/or you are already taking the pension then no issues at all.
What I do not really understand is that the fund is still trading and the price moves each day as normal. The price is only 2% down from before Covid , so not sure why it is still suspended and/or why the price drop is low . It is a very diverse global based fund but still I would have expected to have suffered more . 
I have a property IT and it is down 27% 

dunstonh

The price is only 2% down from before Covid , so not sure why it is still suspended and/or why the price drop is low .

Maybe the valuers havent got over 80% of the properties valued yet and the shock is yet to come.  Maybe they are using it as an excuse to build liquidity in the fund to meet the coming redemptions.

Novice_investor101

Property funds are suspended because  the assets they hold, the properties, cant be valued accurately at the moment. The valuers cant do their jobs due to Covid. Summat about the rules for the funds. 

The brainer ones on the forum will elaborate further shortly, I’m sure. 

Paul_Herring

There may be hope:

Jul 18th 2020: https://www.thetimes.co.uk/article/my-pension-pot-is-stuck-in-property-fund-freeze-tzv02xngd (£):

When he requested a withdrawal from L&G in April, it wrote to him saying that he could not get his money because 20 per cent of it was invested in its £2.9 billion property fund, which has been frozen. L&G said that for customers with stakeholder pensions, such as Stephen, the only payments that could be processed were “payment of death benefit” or “serious ill health claims”.

[...]

When we contacted L&G it said that “partial withdrawals are not possible while an invested fund is suspended. We regret the inconvenience caused to Mr Waller and other L&G policyholders. We have written to all affected customers explaining the reasons for the suspension.”L&G explained that some of its pension products have an automated process when someone makes a withdrawal that deducts money proportionately across all funds. Not knowing what one investment is worth affects the entire calculation.Just when it looked as though L&G would not budge, Stephen received a letter from Andy Waplington, a service complaints manager, saying that the company would transfer the whole of his pension as requested.“Having fully reviewed your case, I’m pleased to confirm that on this occasion we have agreed to make an exception to our normal process and the full transfer can proceed,” he said.

Aug 2nd, 2020: https://www.thetimes.co.uk/article/l-amp-g-promises-to-unlock-pensions-0jqp86r2m  (£):

Legal & General has succumbed to pressure to review a policy that blocks its pension customers from transferring their money to rivals if their savings are stuck in its troubled property fund.

The wealth manager, which froze withdrawals from its £2.9 billion UK property fund in March, has been preventing customers from moving their pensions to rivals, or to different investments within its own group, even if only a tiny portion of it is held in the frozen investment fund.

[...]

Terry Clarke, 67, complained to L&G after he was told he could not move his £108,000 pension because 10 per cent of it was in its frozen property fund. Clarke, from Norwich, wanted to reduce his risk as he approached 70, the age when he would like to start drawing from his pot.

L&G refused to allow any money to be moved. Terry said: “It is important to me in these particularly volatile times that I begin moving my pot into safer funds.

“Although only 10 per cent of my pot is invested in the L&G property fund, they are telling me I cannot proceed with the progressive switch of any of my funds because of its suspension.”

[...]

The L&G UK property fund is the largest in Britain. After being contacted by Money, L&G said that it was “considering setting a new policy to extend the flexibility for customers with exposure to the [property] fund, given we are operating in challenging circumstances — the specifics of which we’re working through”.