Company Pension Scheme

Aclanst67

I have worked for the same company for 30 years, I'm now 53 and so started planning for withdrawing 25% of my pension at 55 (just wanted to understand the process early as its not like going the back and drawing money out is it!!), anyway throughout the years we have been told we can draw 25% without any issues and the remaining 75% doesn't change and while I'm working and contributing will just keep building until my retirement age, Last week several colleagues have started to approach the company to withdraw 25% and the company have stated Oh you can't do that and so far no explanation, what should we do?????

Albermarle

You need to be clearer on what sort of pension it is.
Defined Contribution or Defined Benefit. They are very different.
Defined benefit: final salary pensions schemes explained | MoneyHelper
Defined Contribution Pension schemes | MoneyHelper

jlfrs01

Company and Workplace Pensions often have their own rules, you and your colleagues probably need to read up on the Scheme's T's and C's or ask HR for a copy. It may well be your pension can't be accessed unless you leave your employer ,(in which case it may have to be transferred out of the Company scheme into a SIPP for example), or until the scheme's set retirement date and that isn't necessarily 67.

NoMore

Also just because you can access your Pension at 55 doesn't necessarily mean you should.

dunstonh

anyway throughout the years we have been told we can draw 25% without any issues and the remaining 75% doesn't change and while I'm working and contributing will just keep building until my retirement age,

That would be very unusual.
Firstly, the changes happened in 2016 that opened up drawdown to more consumers.   So, it would only be in recent times that discussions like this would be possible.

Secondly, most workplace pensions do not support drawdown.   Some of the newer schemes do but older occupational pensions rarely do unless they have been changed to a different type.

Last week several colleagues have started to approach the company to withdraw 25% and the company have stated Oh you can't do that and so far no explanation, what should we do?????

As most legacy pensions don't support drawdown, then it would require a transfer to a modern plan that does support drawdown.

However, this assumes that it is a defined contribution scheme and not a defined benefit scheme.

And as mentioned higher up, just because your tax free cash is accessible earlier (potentially), it doesnt mean you should access it.   It could create greater tax in the long term by taking away the tax free money that you could use throughout your retirement and blowing it in your working years in one go.

Marcon

Aclanst67 said:

I have worked for the same company for 30 years, I'm now 53 and so started planning for withdrawing 25% of my pension at 55 (just wanted to understand the process early as its not like going the back and drawing money out is it!!), anyway throughout the years we have been told we can draw 25% without any issues and the remaining 75% doesn't change and while I'm working and contributing will just keep building until my retirement age, Last week several colleagues have started to approach the company to withdraw 25% and the company have stated Oh you can't do that and so far no explanation, what should we do?????

Two possibilities:

1. read the information you were given about the scheme (or look online if your company has an intranet, or the pension provider's website might have a dedicated section for the scheme you are in)
2. go back and ask the company again.

xylophone

I have worked for the same company for 30 years, 

Can you clarify the nature of the pension scheme?


Have you obtained a state pension forecast?

https://www.gov.uk/check-state-pension

Is a COPE shown?

Aclanst67

Thanks for the help guys, very much appreciated