Personal pension

CRISPIANNE3

I have a personal pension with Aviva and wanted to take 25 percent in cash and buy an annuity with the rest. However Avia said I cannot have the cash free amount but either by an annunity or take the whole lot.  Also they suggested transferring the pension to another provider who would allow access of the 25 percent free cash amount. He just said the policy does not allow for the cash free amount. Is this usual?

El_Torro

Yes, it’s usual. 

Some pension plans are older than others, the older ones don’t always have the same options, it’s possible that when your pension plan was created things that are legal now weren’t legal then so the option wasn’t built into the plan.

On the plus side it’s relatively easy to move to another provider. Just make sure they’ll let you do what you want to do before transferring. 

dunstonh

He just said the policy does not allow for the cash free amount. Is this usual?

If you had a black and white TV would you expect it to to offer you ultra HD and Dolby Atmos sound?
Or if you had an IPhone 1, would you expect it it offer you the functionality of the Iphone 13?

Drawdown has been available for decades.  However, it only went mainstream in 2016.  So, most pensions from before then didn't offer drawdown functionality.   Back then you needed a SIPP or a drawdown plan.      

Some providers have been able to code in limited functionality on legacy plans (mainly UFPLS as that was not too far away from trivial payments).  However, for most plans, it is not cost effective to spend millions of pounds coding that functionality when there may only be a very small number of people on that type of plan that need that functionality.  And with most pensions not suffering exit charges (or very limited amounts if they do) moving the pension is the best option.

Linton

To transfer a simple DC pension just set up an account with a new pension provider and ask them to transfer-in your old pension. The new provider will manage the process.

Aviva themselves may offer something suitable.

Albermarle

The OP has not mentioned drawdown, but seems to be saying that they want the 25% tax free cash and buy an annuity with the rest.
This is the traditional way to take a DC pot ( rather than a newer way) so seems surprising Aviva can not do that??

dunstonh

The OP has not mentioned drawdown, but seems to be saying that they want the 25% tax free cash and buy an annuity with the rest.
This is the traditional way to take a DC pot ( rather than a newer way) so seems surprising Aviva can not do that??

Its the same process either way.  Aviva doesn't offer an in-house annuity.   They do still retail annuities but only via open market option or transfer.   

So, let's say Aviva came out top on the OMO comparison, it would still be transferred.

xylophone

Its the same process either way.  Aviva doesn't offer an in-house annuity.   They do still retail annuities but only via open market option or transfer.   

https://www.aviva.co.uk/retirement/pension-annuity/

I am puzzled as to why the OP would not have been informed of this possibility by Aviva.

dunstonh

xylophone said:

Its the same process either way.  Aviva doesn't offer an in-house annuity.   They do still retail annuities but only via open market option or transfer.   

https://www.aviva.co.uk/retirement/pension-annuity/

I am puzzled as to why the OP would not have been informed of this possibility by Aviva.

Maybe its not an ex-CGNU plan.   If its an ex Friends Prov (and their legacy companies) or ex AXA Sun Life (and their legacy companies), then they may not automatically refer people to the Aviva sales team.   The Bristol and Milford offices of those legacy companies still operate separately in most areas.   

Or maybe its on the agency of an active IFA.  They do not generally cross market those to their in-house sales team.

Smilertess

I am going through the same with Aviva.  The pension was a workplace Friends Provident and then was transferred to Aviva as a money purchase scheme and today following the advice from this forum  & my IFA (post is Drawdown denied after being told I could do it) I have started the transfer to an Aviva SIPP.  I will take the 25% tax free and then lump sum drawdowns to use at the end of the tax year if I have any allowance left.  I may transfer it to another SIPP provider but that requires a bit more research.  Aviva have given me awful customer service but that almost seems par for the course atm.

Albermarle

 Aviva have given me awful customer service but that almost seems par for the course atm.

Most of the negative comments on here about poor customer service with pensions is mainly directed at the large traditional providers (  Scottish Widows & Prudential get a lot of mentions) and pension administrators like Mercer and WTW.

The more modern retail SIPP providers, such as Hargreaves Lansdown, Fidelity, AJ Bell, Vanguard etc seem to be significantly better, although still have issues sometimes. 

CRISPIANNE3

I have looked through some old paperwork and it appears my pension was originally with Friends Provident and as you are probably aware they were taken over by Aviva. Also when I die there is no pension for my married partner but the pension pot amount in full.  

I have decided to shop around. Can anyone advise where the best place to start so I can transfer my pension and then buy an annuity.