Increase to Minimum Pension age from 55 to 57 on 6th April 2028

Alexland

ussdave said:

Thanks for the replies above.  I guess we can't really be sure but given the minimal cost in opening a small Vanguard fund it seems worth doing, even if there's a chance this won't work out at all or only the funds in there at the time of legislation are covered by the protected age.

It wouldn't be the funds that have a protected minimum pension age but the scheme member.

Further clarification will be needed from the scheme trustees who will probably seek external advice but from what was discussed earlier in this thread Vanguard seem to be referencing minimum pension access age using 55 as an example of the current age which isn't as strong as others such as L&G and Fidelity's SIPP who are clearly saying unqualified access from age 55 in their materials.

There doesn't seem to be a hurry to pick or change provider so probably best to wait for scheme clarifications assuming they happen before April 2023.

rebuswad

From my research Iweb and Interactive investor's trust deeds have access based on NMPA so my interpretation is age would not be protected. I asked Fidelity for their view and they just referred me to the February consultancy and said nothing was decided yet.

As hugheskevi pointed out if the legislation is not through yet the firms will not know themselves, so it's wait and see. I have a SIPP with II so will likely look to move as not planning on having other income between 55-57 so using the income tax allowance for those years would be prudent.

Alexland

rebuswad said:

I asked Fidelity for their view and they just referred me to the February consultancy and said nothing was decided yet.

That's probably the right answer for now. I am surprised that Aegon gave MaxiRobriguez such a clear answer as if incorrect it could give them liability in future. Fidelity capping on holding a large ETF is much cheaper for us than iWeb or II's fixed price SIPP anyway and everything I have seen from Fidelity has always said an unqualified age 55.

granta

I don't know if I am understanding all the information above correctly or if this is still part of the ambiguity, but would appreciate any thoughts.
I was planning to transfer out to an ii SIPP a couple of old work pensions where I'm pretty sure I had stated my intended retirement age as 55. Ideally, I would like to protect this benefit but reduce my holdings in these pensions to a small minimal amount (the fees are no longer competitive and there are other issues).
By doing a partial transfer out, would it be possible to transfer back a lump sum later on in order to benefit from the access age of 55? I don't want to shut down these pensions entirely.

JamTomorrow

I'm in an L&G Worksave Pension Plan in which the members booklet refers to the scheme being designed to 'provide an income, cash lump sums or combination of both from aged 55 or at a later date if you choose.'  Taking your benefits also goes on to state 'You can take money from your arrangement any time after aged 55.'  Whilst nothing is decided yet I assume this type of language puts me in a good place for being able to access from 55?

Alexland

granta said:

By doing a partial transfer out, would it be possible to transfer back a lump sum later on in order to benefit from the access age of 55? I don't want to shut down these pensions entirely.

You would need to check with the scheme that you think might get a protected pension age supports partial transfers out and back in again not to say they will in the future which could be a risk to your plan. If having access at age 55 is important to you then I would suggest keeping at least those 2 years of investments in such a scheme (or more if you think the government might increase again to 58, 60, etc). It doesn't have to be the scheme you don't like as others should be available provided you become a member of them before April 2023 under the proposal.

JamTomorrow said:

Whilst nothing is decided yet I assume this type of language puts me in a good place for being able to access from 55?

Yes your odds are good with that sort of language but it will be for the scheme trustees to decide and communicate.

hugheskevi

Alexland said:

JamTomorrow said:

Taking your benefits also goes on to state 'You can take money from your arrangement any time after aged 55.' 

Whilst nothing is decided yet I assume this type of language puts me in a good place for being able to access from 55?

Yes your odds are good with that sort of language but it will be for the scheme trustees to decide and communicate.

I'd expect the vast majority of scheme literature to contain very similar language (it is designed to be accessible and useful to scheme members, not to be precisely accurate in legal terms), and doubt it will count for anything when it comes to determining protection status.

It will be the trust deed and suchlike that will determine the status. It was well established with the RPI/CPI change that even very clear statements in scheme literature such as 'Your pension will increase by RPI' didn't confer any entitlement and it was scheme rules that prevailed.

Alexland

hugheskevi said:

It will be the trust deed and suchlike that will determine the status.

You would like to think that the various materials made available to members were designed to reflect the core trust documentation but yes that's why the trustees and their advisors will need to pick through it carefully and the process will take some time. They will be aware of the importance some people place on early access and the need to come to the correct answer either way. It just seems unnecessary the government have put them in this position.

granta

Alexland said:

granta said:

By doing a partial transfer out, would it be possible to transfer back a lump sum later on in order to benefit from the access age of 55? I don't want to shut down these pensions entirely.

You would need to check with the scheme that you think might get a protected pension age supports partial transfers out and back in again not to say they will in the future which could be a risk to your plan. If having access at age 55 is important to you then I would suggest keeping at least those 2 years of investments in such a scheme (or more if you think the government might increase again to 58, 60, etc). It doesn't have to be the scheme you don't like as others should be available provided you become a member of them before April 2023 under the proposal.

Thanks Alex, good points to think about and as you say, I can't predict future risk of those options being closed off. But good to know that there are other pension schemes I could open before 2023 as an alternative. I'm hoping this Board will prove to be a good source of insight into options as things progress.

Retireinten

MaxiRobriguez said:

Anyone who's in an Aegon RetireReady scheme: I asked Aegon outright about retirement ages and they confirmed that access would still be at 55.

Now this would be good news but I'd originally written this scheme off as moving to the new pension age of 57, having skimmed over the terms, so I'm not holding my breath. But I'd rather be pleasantly surprised than disappointed. 


I have another small and very old with profits pension that I took out at 19 and had for just a couple of years. This legislation has made me review the paperwork and it looks like its partially protected at 50 with the contracted out portion accessible at SPA only. Didn't know that so at least this is encouraging me to read my paperwork.

It would be useful to know how our pensions are affected sooner rather than later as this impacts how we save - if it goes in our favour we will be redirecting more into pensions than ISAs.