Aegon Trustee Proposed Section 32 Buyout Policy - Fund Name WP Endowment (A)

oliel

I'm nearly 54 so looking at pension options etc for when I turn 55. I have an old pension mentioned above. My understanding is that this has a protected cash fund and that I may be able to take out more than 25% tax free and wondered if this is correct? There's also mention of GMP - which is think is something to do with guaranteed pension due to the fact the company I worked for went bust years ago. Just wondered if anyone can advise on this or what this means. Thanks

DRS1

GMP has nothing to do with a company going bust. It relates to contracting out of SERPS (the additional element of the state pension that used to apply years ago).

oliel

i suppose then i need to find out if there is enhanced tax free cash

DRS1

It is possible there is enhanced tax free cash but maybe the GMP will interfere with that (see below

Section 32 - buyout bonds - how they work and taking benefits). I am not sure when that was written but annuity rates have been improving lately.

It is the sort of thing that might be mentioned in benefit statements if you get those. Otherwise best to check with Aegon.

If it is a with profits policy (the WP in the name suggests it is) then check if there is a GAR as well while you are at it.

oliel

https://forums.moneysavingexpert.com/discussion/comment/82097208#Comment_82097208

Thanks I will ask, all seems very confusing.

dunstonh

I'm nearly 54 so looking at pension options etc for when I turn 55. 

If the fund is insufficient to meet the GMP, then you will not be able to access the pension until 60 (women) or 65 (men).

If the value of the pension is over £30k, you would need an IFA if you wanted to access it flexibly.

xylophone

See also https://www.gov.uk/government/publications/pension-benefits-with-a-guarantee-and-the-advice-requirement/pension-benefits-with-a-guarantee-and-the-advice-requirement

oliel

https://forums.moneysavingexpert.com/discussion/comment/82098050#Comment_82098050

thanks

https://forums.moneysavingexpert.com/discussion/comment/82098050#Comment_82098050

https://forums.moneysavingexpert.com/discussion/comment/82097573#Comment_82097573

thanks never straightforward.

oliel

Managed to speak to argon about this still dont completely understand though. Was told there is protected tax free cash but will only know how much when I get a pension illustration at 55. Apparently there is with profits guarantee at maturity date of age 60 of £1 per unit plus bonus if i cash in before I would loose £1 guarantee per unit and percentage of bonus. No GAR and no GMP. Im trying to ascertain how i know if Im better to take the pension at 55 or 60 - Am i right in thinking it depends on the unit share price at the time or am I missing something?

oliel

ive just noticed current unit price is 71p no idea what the bonus is.

dunstonh

Was told there is protected tax free cash but will only know how much when I get a pension illustration at 55.

Whilst advisors have the software to calculate it, frontline staff at Aegon almost certainly won't. It also changes daily.

No GAR and no GMP.

In the first post, you said it did mention GMP.

ive just noticed current unit price is 71p no idea what the bonus is.

Look at the difference between the current value and the surrender value.