Small pot

bullinn1

I really have no idea what this

Marcon

bullinn1 said:

I really have no idea what this is:
[Image removed by Forum Team]

Given your age, don't worry about the 'small pot' terminology and just focus on what they are offering.

You have two policies with Rothesay. The smaller could either be taken as a continuing pension, or you could have a one-off lump sum of £8,598.33 (potentially taxable) and no further pension payments. The larger can only be taken as a continuing pension. 

DRS1

You might want to blank out your name.

It is an Appendix so presumably the document it is attached to will explain what it is all about?

Looks like they are offering you the chance to cash in one policy for a lump sum.  There may be some income tax to pay on that.

Brie

Small pot simply refers to the fact that it's a small amount of money under a legislated amount which means you can take the whole thing in one go.  It means they can get your off their books if you agree.  Less fuss for the admins.

bullinn1

So in simple terms I can continue to get £1k/year or take an £8.5k lump (less tax)  … If I live for another 7 or 8 years I’ll be even, any more and I’ll lose out ? Unless I want to blow a few grand on wine women and song (wife permitting) !

Albermarle

bullinn1 said:

So in simple terms I can continue to get £1k/year or take an £8.5k lump (less tax)  … If I live for another 7 or 8 years I’ll be even, any more and I’ll lose out ? Unless I want to blow a few grand on wine women and song (wife permitting) !

Yes it is a poor offer.

HumberFlyer

I remember me having a choice like that. I took the lump sum and reduced pension going on the assumption (due to health reasons ) I won't have more than a few years to go. I wasn't desperate for the lump sum. I am still here many years later and taking the increased yearly pension would have been better.... a lot better..... but there ya go, you don't know the future.

Secret2ndAccount

You are understanding the options, but you've got your sums backwards. The longer you live, the more profit you make. This offer is taking the p...  For a 1k pension they should be offering you 20k to buy you out. Unless you have bad news we don't know about, take the annual payment, not this derisory offer.

Marcon

Secret2ndAccount said:

You are understanding the options, but you've got your sums backwards. The longer you live, the more profit you make. This offer is taking the p...  For a 1k pension they should be offering you 20k to buy you out. Unless you have bad news we don't know about, take the annual payment, not this derisory offer.

Why on earth would they offer £20K to someone of OP's age when the annual pension is a non-increasing £997?

Not really very helpful.

Keep_pedalling

Marcon said:

Secret2ndAccount said:

You are understanding the options, but you've got your sums backwards. The longer you live, the more profit you make. This offer is taking the p...  For a 1k pension they should be offering you 20k to buy you out. Unless you have bad news we don't know about, take the annual payment, not this derisory offer.

Why on earth would they offer £20K to someone of OP's age when the annual pension is a non-increasing £997?

Not really very helpful.

We don’t know the OPs age!

Marcon

Keep_pedalling said:

Marcon said:

Secret2ndAccount said:

You are understanding the options, but you've got your sums backwards. The longer you live, the more profit you make. This offer is taking the p...  For a 1k pension they should be offering you 20k to buy you out. Unless you have bad news we don't know about, take the annual payment, not this derisory offer.

Why on earth would they offer £20K to someone of OP's age when the annual pension is a non-increasing £997?

Not really very helpful.

We don’t know the OPs age!

Even more reason not to comment on what might be a reasonable sum to buy out the pension - but I'd checked previous threads and he's 74 or 75,