deferred pension, want to cash in they not letting me?

sunshine0000

I am trying to cash in my pension i am 59. it is a deferred pension and they are not letting me. they say I have to take it yearly, I have cancer so this is no good to me.
They say that it is because i am married.

Albermarle

sunshine0000 said:

I am trying to cash in my pension i am 59. it is a deferred pension and they are not letting me. they say I have to take it yearly, I have cancer so this is no good to me.
They say that it is because i am married.

Presumably this is Defined Benefit pension, where you have a promise of an annual pension, rather than a cash sum?
Due to problems in the past there are strict rules about trying to cash in these sorts of pensions, as the guaranteed annual pension income is a valuable thing to have.
If you were to die early your spouse would continue to get at least part of the pension.

I think ( not sure as each scheme is different) there maybe some way to take it early if you were really at deaths door, but normally I think you have to be very ill/dying soon for this to happen.

xylophone

See

https://techzone.abrdn.com/public/pensions/Guide-Pensions-and-Ill-health#anchor_4

With regard to defined benefit schemes, if the member is married or in a civil partnership, there will be restrictions placed on any GMP or Section 9(2B) rights as the scheme needs to retain sufficient of the pension fund to allow it to provide a survivor's pension. The balance of the benefits, if any, can be paid out as a lump sum.

sunshine0000

so unfair my husband well catered for in pension, will inherit our house his parent and my mums. i worked for this pension before I met him will not bennfit from it. he has confirmed he does not want it he wants me to have something now. so I get cancer and no money he gets his life all the money and my only pension he doesn't want.

Marcon

sunshine0000 said:

I am trying to cash in my pension i am 59. it is a deferred pension and they are not letting me. they say I have to take it yearly, I have cancer so this is no good to me.
They say that it is because i am married.

Is your pension already in payment? Presumably not as you say it is deferred.

Have you been given any indication (apologies, there's no delicate way to ask this) that your life expectancy is no more than 12 months?

Silvertabby

My sympathies to you and your family.  A truly dreadful situation for all of you.

Would you be willing to post the name of your pension scheme?  Different schemes, even within the public sector, have different rules, so if we know which regulations apply one of us on here may be able to help.

Pat38493

sunshine0000 said:

so unfair my husband well catered for in pension, will inherit our house his parent and my mums. i worked for this pension before I met him will not bennfit from it. he has confirmed he does not want it he wants me to have something now. so I get cancer and no money he gets his life all the money and my only pension he doesn't want.

Looking at these posts, if the pension is a deferred DB pension, is it a public service pension or from a private company? 

If it's a private company, you might be able to transfer it away from the DB pension to another provider, but only if you get an opinion from a qualified financial adviser which will cost several thousand pounds to get.  If the adviser recommends  (for example on the basis of life expectancy plus partner having already adequate pension provision) that you should be able to transfer the pension away from DB pension, you could then transfer it to a DC scheme.  The adviser however may still recommend to not transfer, in which case your options are much more limited.  

However this process will at best take months.

As far as I'm aware the existence of spousal pension provision does not prevent you from going through this process.

If it's a public service pension you cannot transfer out to you are a bit stuck there although you may be able to pursue the avenues mentioned by Marcon if your diagnosis is unfortunately terminal.

Alternatively - if your husband is already over 55 years old, and depending on how his pension provision is structured, you could discuss the option of him taking money out of his pension to do whatever it is you want to do in lieu of using your deferred DB pension.  

xylophone

I seem to remember that there was a post on the forum fairly recently  which indicated that a terminally ill scheme member was able to   

take his/her benefits from the scheme and that benefits would remain in place for dependants.


However I can't remember  the name of the scheme (or if Public Service)  or whether or not there was any stipulation concerning

contracted out  (GMP/S9 (2B) rights) see link in post above.

I have found this from NHS scheme which is a Public Service Scheme - it will have the contracted out rights but they are not

mentioned here,

https://faq.nhsbsa.nhs.uk/knowledgebase/article/KA-05120/en-us

Silvertabby

In the case of the LGPS, the deferred benefits would have to be accessed on the grounds of ill health, with the occ health dr confirming that life expectancy is less than 12 months.

The pension could then be taken as an ill health commutation - ie, 5 X annual pension (plus adjustment for any pre 2008 automatic lump sum) tax free.  But spouse's/children's pensions can't be commuted - they would still be payable on the member's death.

So many schemes, so many rules I'm afraid.

Marcon

xylophone said:

I seem to remember that there was a post on the forum fairly recently  which indicated that a terminally ill scheme member was able to   

take his/her benefits from the scheme and that benefits would remain in place for dependants.

If life expectancy is no more than 12 months, and the rules of the particular scheme allow 'full commutation on grounds of serious ill health', that's all OP needs to know to ask her scheme to clarify if that's an option.

It's the member's own pension that is commuted, and spouse/civil partner/eligible children's pensions are still payable by the scheme.