Phoenix Life will not allow drawdown

RomfordNavy

Been trying to cash-in 25% of a pension with Phoenix Life which has resulted in various forms back and forth but now they have finally come up with the excuse that they "do not offer a drawdown facility".

What are my options now, do I need to transfer the whole pension to a different provider before I can access this 25% lump-sum?

gm0

Short version - yes

Many old products, closed books (of life companies that left), older employer trusts have ended up with companies like this one.  Who have picked up doing admin of a diverse basket of old, unloved, not open to new business stuff.

I don't know which category yours falls in - personal product or old employer trust - of course.  But the implications are much the same.

You exercise the legal right to full transfer out.  To move to a product  / SIPP / Scheme (via new employer) as suits your circumstances.  And supports the particular range of features (investments, drawdown methods - monthly ufpls etc. you require, at a cost you like.

Old schemes not updated will quite often have "25% cash" then Annuity purchase written into them.  And drawdown has not been retrofitted.  Nor will it be.  More active still in use schemes with employers still using them are quite often retrofitting it (belatedly) i.e. offering a way to do it to their members. 

But this too, quite often just provides a "transfer" - just to an employer negotiated modern platform and product.  And the old trust records and processes remain broadly as was.

The reasons this would be in any way problematic (other than some admin for the "pull" to happen when you give details to your chosen new provider are:

- Preserved extra benefits of an old DC pension - Guaranteed Annuity Rates being the classic.  This existing (correctly) obstructs ease of transfer - as the cash moves and the right to (what for a few is a fairly valuable benefit) is extinguished upon transfer.  Low GARs of course are just a bit inconvenient and don't stop you doing what you want ultimately.  There is some more edge case complexity you can trip over.  Most DC pensions though are trivial to transfer.  Just remember it's pull not push.  New provider.