Advice needed with pension savings and options

TwoRivets

mrklaw

Thanks for the reply. I'm working at the moment and have no other pensions paying out. If I have to stop working before I reach 67 there will be nothing coming in unless I can get sick pay or some other benefit.

eskbanker

Is there any need to act now? If your concern is that you'll need income if unable to continue with employment, why not wait and see if that transpires and decide on your optimal approach at that point?

It may be sensible to ask about likely timescales for starting to access the pension, and if necessary make a token drawdown to give yourself a buffer if you don't have one when potentially needing to stop work in a hurry, but on the face of it it doesn't sound like you actually need to do anything with the rest of the pot at this stage, unless they're literally saying that it would be inaccessible until 67 if you don't withdraw now?

DRS1

https://forums.moneysavingexpert.com/discussion/comment/82129571#Comment_82129571

Most DB Schemes will allow you to take early retirement - they will just apply an early retirement factor to your pension to try to keep it cost neutral for the scheme. It may be that you will not need to access it until you are 67 but in case it may come in handy I suggest you see what information the scheme webpages or documents have on early retirement.

While you are at it you should check what the scheme has as your normal retirement date. Old final salary schemes tended to have 65 as the male normal retirement date. When they made the change they may have made the NRD for the new bit 67 but that doesn't mean they will have changed it for the old bit. And some schemes which have done this allow you to take the old bit from the old NRD unreduced while leaving the new bit until 67. Obviously if you could get a full pension from 65 you might expect them to have contacted you but it is always worth checking for yourself

Marcon

https://forums.moneysavingexpert.com/discussion/comment/82129571#Comment_82129571

The first setence of your opening post suggests otherwise:

I'm 65 this autumn and because my original retirement age was 65 I've been offered a retirement options pack which includes leaving alone until I'm 67.

I'd check the point directly with the scheme to make sure you are absolutely clear on your options now - one of which I would expect to be accessing your pension at age 65 if that was the scheme's retirement age while you were an 'active' (contributing) member.

Brie

As @Marcon says double check about your normal retirement age for the DB scheme. This should be outlined on the annual benefit statements you are being sent. I would rely on that rather than discussing it with a scheme admin because as the scheme changed they may not be aware that your NRA hasn't changed. This error was made by one of my work schemes who told me my NRA was 65 when in fact it was 60. I only clocked this (a couple of years late) when I realised that my husband's NRA for a newer version of the same scheme was 65.

DRS1

https://forums.moneysavingexpert.com/discussion/comment/82129815#Comment_82129815

I suspect the options pack relates to the "rescued" pension not the other one.

LHW99

Check also that if the scheme NRA is 65 (and a DB) if there is any additional benefit in leaving till age 67 to draw it.

Some schemes will continue to increase the amount if it is deferred, some won't (mine didn't). If there is no increase after NRA if still deferred, you may as well take it at NRA.

TwoRivets

My thanks to eskbanker, DRS1, Marcon, Brie and LHW99.

The options pack relates to the rescued pension. About 18 months after the state pension age increased to 67 there was a series of meetings with employees who were in the company pension and we were told the age was increasing from 65 to 67 and I'm strongly under the impression it was increasing with no ifs no buts. So I've always assumed the company pension is untouchable until I'm 67, I'll check as advised