Pension Transfer Value

tsmiggy54

October this year a small pension of mine matures. I have tried to make sense of the forecasts, but to no avail. They do give me a transfer value of around £16000, but i am not sure, that is what i can expect to get,

I would appreciate any pointers with regards to this.

Thanks

Linton

We need to know more about your pension to be able to explain what the transfer value means. In general pensions don’t “mature”. 

Firstly is it a DB (eg final salary or similar) employers pension where you are guaranteed a specified income in retirement based on your years of service or DC where you build up a lump sum which you can use in various ways to provide income?

tsmiggy54

It was original Freinds Provident pension, taken out when i started self employment. For some reason i will be 70 before it finishes. Which will be October this year. I was not guaranteed a specific sum. And it as not paid any bonuses for a few years now. I have to admit i have no idea, what happens when i reach 70, and my monthly payments end.

When i retired when i was 66, i did ask about taking some money out, but they informed me, that it was not possible. I have to admit, i was not overly bothered. If it helps the company in question is Aviva 

Thanks 

dunstonh

For some reason i will be 70 before it finishes

Most ex FP pensions are legacy plans (old fashioned) and their maturity age would be 75.   Anything less than that is a choice.  The age is only for the annual statements and projections.  It doesn't mean it has to be taken at that age.

When i retired when i was 66, i did ask about taking some money out, but they informed me, that it was not possible. I have to admit, i was not overly bothered. If it helps the company in question is Aviva 

You have more options like that with a modern plan.  But legacy plans you don't.   If you still only want some of it, then moving it to a modern plan may be a viable option.

tsmiggy54

Most ex FP pensions are legacy plans (old fashioned) and their maturity age would be 75.   Anything less than that is a choice.  The age is only for the annual statements and projections.  It doesn't mean it has to be taken at that age

But would i be able to take it at that point. And is the Transfer Value the amount i can take? As i  would like to take it at that point.

Thanks

dunstonh

tsmiggy54 said:

Most ex FP pensions are legacy plans (old fashioned) and their maturity age would be 75.   Anything less than that is a choice.  The age is only for the annual statements and projections.  It doesn't mean it has to be taken at that age

But would i be able to take it at that point. And is the Transfer Value the amount i can take? As i  would like to take it at that point.

Thanks

Most ex FP plans can be taken as a full lump sum.   A smaller number allow partial.   If you want partial and your version doesn't then you can transfer it to a modern plan and take a partial amount from that (with the rest available to take later).

If you are on means tested benefits, you need to be careful what you take as a lump sum.

tsmiggy54

Thank you for that.

I would want a full lump sum. Luckily i am managing fine, but my older grandson is not. I am not on means tested benefits. I am just a little confused about the amount, i am likely to get, and the relationship with its transfer value. 

Dazed_and_C0nfused

tsmiggy54 said:

Thank you for that.

I would want a full lump sum. Luckily i am managing fine, but my older grandson is not. I am not on means tested benefits. I am just a little confused about the amount, i am likely to get, and the relationship with its transfer value. 

Don't forget that 75% will be taxable so that is something to consider, especially if taking it all in one go will push you into a higher tax bracket.

tsmiggy54

Dazed_and_C0nfused said:

tsmiggy54 said:

Thank you for that.

I would want a full lump sum. Luckily i am managing fine, but my older grandson is not. I am not on means tested benefits. I am just a little confused about the amount, i am likely to get, and the relationship with its transfer value. 

Don't forget that 75% will be taxable so that is something to consider, especially if taking it all in one go will push you into a higher tax bracket.

Thank you for that. I did forget about the tax implications. 

Marcon

tsmiggy54 said:

Dazed_and_C0nfused said:

tsmiggy54 said:

Thank you for that.

I would want a full lump sum. Luckily i am managing fine, but my older grandson is not. I am not on means tested benefits. I am just a little confused about the amount, i am likely to get, and the relationship with its transfer value. 

Don't forget that 75% will be taxable so that is something to consider, especially if taking it all in one go will push you into a higher tax bracket.

Thank you for that. I did forget about the tax implications. 

So taking some in the current tax year and some in the next tax year would be sensible, if that's a possibility.

tsmiggy54

Thank you for that. It is a good point about either side of the tax year. I will contact them, and see what the situation is.

Once again Thank you