SERIOUS Ill Health and Pension

Any advice please, sadly brother diagnosed with a fast terminal illness. Not expected to live much longer heartbreakingly. 
He just finished work at age 58 after 40 years service. 
Pension have given him the option of crystallising his pension now. 
However is this the right thing to do? 
Would it be better for family sake to wait until he passes. He is not going to benefit either way but don't want his money going back to the company if he can have it all now. 


  • MallyGirl
    MallyGirl Forumite, Senior Ambassador Posts: 6,318
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    edited 22 June at 2:40PM
    you would need to provide much more info to get any help.

    Is it DC or DB pension?

    I have a friend with terminal cancer and she got a letter to that effect from her consultant which enabled a transfer out from her to get at the value of her her DB pension so that it will be available in full to her husband/daughter in the future.

    updated as the term I used may be incorrect
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  • Silvertabby
    Silvertabby Forumite Posts: 8,571
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    edited 23 June at 10:08AM
    Awful situation to be in, and my heart goes out to you all.

    It really does depend on the type of pension - do you know?

    If it's a DB scheme then, as Marcon says, full commutation (but retaining spousal benefits) could be an option, but that may not be the best thing for his family.

    In the case of the LGPS, I have sadly steered (not allowed to advise) fund members in this position NOT to take the full commutation (tax free lump sum of 5 X pension) but to take the minimum pension/maximum commutation option, even if the lump sum is less than 5X pension (it rarely was).  Then, on death, a further tax free lump sum of 10 X pension minus pension already paid is paid to the nominated beneficiary.  This applies to other public sector pensions, albeit mostly with a 5 year guarantee period instead of 10.
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