changing retirement age for 'with profits' pension

maddoglewis

I have a pension with AEGON which is a 'with profits' pension fund. I am 48 years old and my retirement age is currently set at 65. With government changes to pension ages I believe I should be able to access this pension from the age of 57. I have tried to change my retirement age with AEGON to access my pension from the age of 57 but they would not let me because it is a 'with profits' fund. Are there any other options to do this? Will I forfeit some of the funds if I do?

Workerdrone

I am exactly the same age and have exactly the same with profits fund with argon, initially set with a retirement date of 65. It's only part of my fund. I have tech funds but I have the same question. will I be able to draw on my pension and leave the wp element until 65

LHW99

WP funds are more like the old endowment policies that have a payout date set at the start, and aren't flexible.

It should be possible to transfer to another pension fund with Aegon (or elsewhere as long as its not your current employer's scheme).

The issue for you is whether the fund sets an MVA at the moment, which you can't absolutely be sure of until it is transferred.

dunstonh

The WP fund has the potential to have an Market Value Reduction.     However, there will be a MVR free exit point and that will be at the original scheme age.

You do not need to change the scheme age to take it a different age.   

maddoglewis

dunstonh said:

The WP fund has the potential to have an Market Value Reduction.     However, there will be a MVR free exit point and that will be at the original scheme age.

You do not need to change the scheme age to take it a different age.   

Are you saying that the MVR will reduce gradually as I approach the set retirement age of 65? So if I transfer the pension to another scheme when I am 57, the MVR will be less than if I transferred it when I was 48?

dunstonh

Are you saying that the MVR will reduce gradually as I approach the set retirement age of 65?

If there is an MVR currently in place, then it usually ceases at scheme retirement age.  Its not gradual. One day before you could still have a large MVR but the day after, its gone.

Is there an MVR in place at the moment? - If not, then you may want to consider fund switching out of the WP fund into a more appropriate investment.  If fund switching is not available (which it may not be on a legacy old fashioned plan) then transferring to a modern pension may be better and then selecting investments that reflect the shorter timescale and wont have the potential of an MVR being put in place (which currently is the case if you have no MVR at the moment).