Aegon s.32 Buyout Plan

xylophone

Or The Doc ?

https://forums.moneysavingexpert.com/discussion/comment/78062585/#Comment_78062585

WitsEnd101

xylophone said:

Sadly it ended in 2021 without any update on whether they managed to get their PTFC out without the FA.

Presumably  reference to post subsequent to this?

https://forums.moneysavingexpert.com/discussion/comment/77171920/#Comment_77171920

Try PM to Blackavar?

Thanks, I have just sent a PM.

I am hoping that they might be able to share a 'killer' template letter they sent to Aegon that was persuasive enough for Aegon to waive their silly rules.

WitsEnd101

Apologies for regurgitating this thread up again, but I have been giving it some additional thought. Whilst waiting for a response back from Aegon on my complaint I was thinking about other ways I might get my hands on that PTFC. As I have the option to take the PTFC with an annuity, I had a thought about the format of the annuity. There is no stipulation on the kind of annuity set out in the pension statement provided. So I am wondering if I could opt for a fixed term annuity for a short duration?

I would be grateful for any comments or criticisms on this approach. Also, if there is a way to go down this route, does anyone know how short a duration I can go for and is it possible to take the remaining funds on maturity of the annuity and move them into my SIPP for drawdown? By this time I would hopefully have had the PTFC.

xylophone

https://www.legalandgeneral.com/retirement/pension-annuity/guides/what-are-fixed-term-annuities/

penners324

Take the PTFC, put the rest in to drawdown then transfer 

WitsEnd101

penners324 said:

Take the PTFC, put the rest in to drawdown then transfer 

Hi penners324, I don't blame you for not reading through all the previous posts on this thread, but I wish it was that easy. In summary, Aegon will not allow me to take the PTFC with drawdown without going to the expense of hiring a FA or IFA.

I did a search on this forum for fixed term annuities (FTA) and there was one that had a discussion as to whether they are technically an annuity. The thrust of the argument being an annuity is an income for life. A FTA is clearly not for life. I now expect that Aegon will not accept the PTFC with FTA option. Will report back.

UPDATE

Aegon will accept FTAs and pay the PTFC. Also looking at xylophone's very helpful link to the L&G annuity calculator, I can go for a 3 year term and set the end lump sum to as a high or low as I like (within the parameters of the fund value).

I think I might go for this approach as a fair compromise. Thanks for those who have taken the time to comment and any further thoughts are very welcome.

DIXIE_2

Find myself in a similar situation, so very grateful to know the outcome and Aegon's response regarding their insistence on employing an FA

WitsEnd101

DIXIE_2 said:

Find myself in a similar situation, so very grateful to know the outcome and Aegon's response regarding their insistence on employing an FA

Sorry to be the bearer of bad news. I'm afraid Aegon still insist on employing the IFA or FA if you go down the drawdown or ufpls route. Below is a copy of the gobbledegook they sent to me in response to my complaint. As I said above, I will probably try the fixed term annuity route for as short a duration as possible in order to execute something close to my desired plan.

Good Morning, 

Thank you for your query on your Aegon policy.  The Aegon drawdown plan is on our Platform with Aegon Retirement Choices (ARC) or Aegon One Retirement (AOR) and both of these propositions are adviser lead. 

This means that you require a financial adviser to transfer money onto these propositions and we therefore we cannot do the transfer on an execution only basis. A financial adviser must be involved. If you have any queries regarding this please contact Aegon platform directly. 

HMRC have recently tightened up on their rules regarding the designation of funds to drawdown, which means that it’s no longer enough for the member to just inform us that they want to designate funds to drawdown, we must also must be capable of making a payment of income withdrawal under the scheme. Although we do not actually have to make a payment, we must be capable of making a payment from the member’s plan. However, it is not possible for us to make an income payment from the member’s plan.

“Bringing a drawdown pension into payment

Paragraph 8 or 8A schedule 28 Finance Act 2004

In order for a designation to take effect, it is not sufficient for a member to just inform their scheme that that are designating their sums and assets. The scheme must be capable of making a payment of income withdrawal to that member, however a payment does not have to made from the designating scheme. If a member makes a request to designate their sums and assets where there is no possibility of income withdrawal to the member, an effective designation will not have taken place. A payment from the scheme does not have to be made, however it must be possible.” 

PTM062701 - Member benefits: pensions: drawdown pension rules applying from 6 April 2015: overview of drawdown pension rules applying from 6 April 2015 - HMRC internal manual - GOV.UK 

Therefore we have put an immediate pause on all settlements of PTFC with the remainder to flex-access drawdown with Aegon until we are able to fully consider the impact of this. 

Our Proposition and Legal teams are already considering our options. This may take some time and we do not know what the outcome may be. We will contact you when we can.’ 

Regards

 

DIXIE_2

Thanks for prompt response.  The letter is not at all clear and seems to imply that drawdown is not even an option.  Alarming to say the least.

WitsEnd101

Yes, its a poorly drafted letter which is not even grammatical in places. It does not give me much faith in Aegon's customer services.

I have just started early retirement a week ago, but thankfully I don't envisage I will need to access this pension for a while yet.