Pension Drawdown not available

Stenchpipe

I am 61 and reaching my planned retirement date in Dec 25.  I have 4 'pensions',3 are from the late 80's and the other from 2006.  I am fortunate in that I don't need regular income from the pensions and our plan was to use the flexible drawdown option.  For the older pensions, in all of the annual statements and details of the plans all of them refer to drawdown.  I have now discovered that none of them actually offer a drawdown.  They enable you to transfer the balance of your funds but they don't actually allow you to drawdown.

Having done the right thing and saved through pensions I am now in a poistion where I cannot access the funds in the way I had expected.

I can transfer to other funds BUT there are lots of restrictions.  There may be fees and I will have to employ an IFA either to action the transfer or to authorise the transfer.

One of the pensions is a defined benefit which will give me £2000 per annum but is worth £100000.  I understand this amount is guaranteed, although it does change each year.  I also understand that this does not form part of my estate so can be passed on when I die.  My plan was to use money while I'm still alive!

I have a small pension with Scottish Widows for £5600 and an AVC with Zurich for £70000.

Having saved and then taken all the retirement options into account I found I cannot do what I wanted to do.  Whichever way I go I have to now shop around for new pensions and shop around for an IFA and take into account all the fees.  I thought I was happy with the companies I have invested with.  I have talked to them but they all can't give financial advice.

This must be affecting lots of people of my age who would have taken out, or been signed up, to pensions in the 1980's who are now approaching retirement age.  The hype about you can do anything you like is not true.  Not true unless you take the risk anc cost of transferring your funds to a new scheme.

Dazed_and_C0nfused

I can transfer to other funds BUT there are lots of restrictions. There may be fees and I will have to employ an IFA either to action the transfer or to authorise the transfer.

An IFA should only be necessary when it is a DB pension with a CETV > £30k or a DC pot with certain benefits.

A standard DC pot can be transferred without advice and, I suspect, without fees.

You may get more responses by posting on the pension board but before doing so you could do with adding some more detail about the DB pension.  This will almost certainly be increasing in value each year from an inflation related increase and may a PCLS and/or survivor benefits.  They are all relevant factors determining whether agreeing to give up that source of income is a sensible idea.

The most critical thing is likely to be the £2,000 value.  Is the amount when the pension was deferred or the current amount reflecting all the annual increases since deferment?

Albermarle

As said above , two different issues in play.

I have a small pension with Scottish Widows for £5600 and an AVC with Zurich for £70000.
Most likely that they do not offer drawdown simply because the pensions were set up a long time ago. Unless they have some specific benefits attached to them ( like a guaranteed annuity rate) they can be easily transferred to your newer pension, or a completely new pension that offers flexible drawdown. No need for an IFA and can be done on the internet in 10 minutes at no charge .

One of the pensions is a defined benefit which will give me £2000 per annum but is worth £100000. 
This is a completely different situation.
Firstly what you have is a pension that guarantees you a lifetime income, probably with some inflation linking. That is its value. As a secondary issue the pension scheme has offered you a sum of money to buy you out of the scheme/get you off their books. A CETV in the jargon, which will vary significantly every time you ask for it, although the promise of a guaranteed pension will not.
However the transfer of DB pensions into a DC pension ( like your other pensions) is heavily regulated, partly due to past scandals. You need to pay an IFA £5K to £10K and if they give a negative recommendation to transfer, then you have lost your money.
There are numerous threads on this subject, so I suggest you put 'DB transfer' in the search box above and here is your starter for ten.
Defined benefit pension — MoneySavingExpert Forum

ps - £100K for £2K pa seems unbelievably high so you need to double check that ( as mentioned in the previous post)

OldMusicGuy

You can easily transfer an AVC pension with Zurich to a provider that supports drawdown (I know, because I did). It costs nothing and is easy to do, no adviser needed.

Like Albermarle said, your DB pension is completely different and you need to understand the difference between the two. The "pension freedoms" do not apply to that type of pension in the same way as they do to DC pensions.

Set up a free appointment with Pension Wise if you haven't had one, they will help you understand the differences and the options you have.

dunstonh

I have now discovered that none of them actually offer a drawdown.  They enable you to transfer the balance of your funds but they don't actually allow you to drawdown.

All quite normal and to be expected.  If you bought a TV in the 1980s, would you expect it to now offer ultra HD and Dolby Atmos?   no.  So, don't expect legacy pension plans to offer modern options either.

Having done the right thing and saved through pensions I am now in a poistion where I cannot access the funds in the way I had expected.

That is not correct.  Nothing is stopping you.

I can transfer to other funds BUT there are lots of restrictions.  There may be fees and I will have to employ an IFA either to action the transfer or to authorise the transfer.

You don't have to use an IFA. You can DIY.  However, even if you use an IFA, it will frequently result in lower charges or similar charges as cost of modern plans is lower than many older ones.

One of the pensions is a defined benefit which will give me £2000 per annum but is worth £100000.  I understand this amount is guaranteed, although it does change each year.  I also understand that this does not form part of my estate so can be passed on when I die.  My plan was to use money while I'm still alive!

DB pensions don't have a value.   They pay a range of defined benefits.   You can transfer them under advice but statistically, we are back to around 1 in 10 cases only being suitable for transfer.   If that £100k is the CETV and its recently obtained then it was probably £200k 12 months ago.  If that CETV is many months old, then it will be a lot lower now.  Possibly at around £50k given the multiple you are using.

DB schemes have never had a pot of money to use.   So, why you believe it would doesn't match with reality.

Having saved and then taken all the retirement options into account I found I cannot do what I wanted to do.  Whichever way I go I have to now shop around for new pensions and shop around for an IFA and take into account all the fees.  I thought I was happy with the companies I have invested with.  I have talked to them but they all can't give financial advice.

You are paying fees on the existing plans.  They are not always as transparent as modern plans but you are paying them.
You say you are happy with the companies you have invested with.  However, that is probably on par with saying you haven't got a clue about them and are making an opinion about them with no knowledge.    For example, Zurich plans are often pretty rubbish (ex Allied Dunbar ones for example) and SW plans are often dated and limited and SW don't have the best of performance typically.

This must be affecting lots of people of my age who would have taken out, or been signed up, to pensions in the 1980's who are now approaching retirement age.  The hype about you can do anything you like is not true.  Not true unless you take the risk anc cost of transferring your funds to a new scheme.

it affects most people but then most people don't whinge about updating their pensions to modern plans that are frequently cheaper and better.