Confusing / contradictory Standard Life terminology

Gazoza

I have a Standard Life Personal Pension Plan (Personal Pension One).

Part of this is invested in Standard Life With Profits One Fund.

In the annual pension statements, under the heading 'Your with-profits guarantee', the first paragraph reads:

"Your plan guarantees a minimum payment from any part of your with-profits
investments made more than five years before you retire, as long as you take your
pension benefits on the retirement date that was selected when your plan started. You
may also be able to benefit from this minimum payment if you take your pension
benefits earlier or later than your planned retirement date in some circumstances."

I find the first sentence confusing / contradictory. To me it talks of a guarantee if taken more than 5 years before retirement. This does not make sense to me. Can anyone explain in clear concise terms?

QrizB

To me it talks of a guarantee if taken more than 5 years before retirement.

It doesn't say "taken". It says "made".

DRS1

It still looks quite odd but the first sentence seems to be saying if your selected retirement date is age 65 then you have to take the benefits at 65 to get this guarantee and the guarantee only applies to any contributions made to the with profits bit before age 60. The second sentence then says you may get the guarantee if you take the benefits earlier or later than 65 in some circumstances.

The guarantee looks like a guaranteed annuity rate and they can be valuable things to have (as well as awkward things to have if you ever want to transfer the pension elsewhere).

Other insurers put a stop to guaranteed annuity rates for contributions after a certain date so it is a little odd that SL have kept it for contributions you could still be making now and in the future.

Gazoza

Thanks for the feedback.

@QrizB - I see what you mean. I had understood the 'made' as referring to the payment (hence my use of the word 'taken'). But I can see that it can be read as referring to the investments into the WP more than 5 years before retirement. Could have been better constructed IMHO.

@DRS1 - The guarantee is just that they won't apply an MVR under certain conditions. Definitely not a GAR (if only it was).

DRS1

Ah If it is just no MVR then it is nothing special. I think most insurers say there will be no MVR if you take the benefits at your selected retirement age. When I took some benefits from a with profits fund at a different age I was told to check that there was no MVR at the time and there wasn't one. They will usually tell you if there is an MVR currently if you call them.

Albermarle

https://forums.moneysavingexpert.com/discussion/comment/81968486#Comment_81968486

Plus there will normally only be an MVR after a significant market downturn that persists for a long time, which is not the case at the moment. Still worth checking though.