Pension take it or leave it.

Edwin_starr

I am 53 years i was in a final salary company pension scheme which stopped in 2006 most of the people i know in the age bracket have taken it out because of fears of the funding of the scheme the company have put in 19 million but it still has a shortfall of 64million .There has been talk of the transfer values being reduced i decided to leave it in for a year to see what happened
The pension is lump sum £25.300.00
annual pension of £5. 000 00 + 3.5% a year
The lump sum does not alter if i take it now or leave it till 65
over a year of leaving it in the pension has made £600
Any little tips would be most welcomed
Thank you .
ps my Lifetime Allowance is £129 .211 .20 what is this thanks

EdInvestor

The pension is now under the protection of the Givt via the pension Protection Fund, so I wouldn't worry about it.It should increase by inflation or 5% until you retire.

Lifetime allowance is the maximum you can have in pension savings and get tax relief. That figure is probably your remaining unused allowance.

Retired_I.F.A.

A difficult one to call i'd say, yes it's underfunded and probably covered to 90% by recent legislation but that is only a part of the picture.

I presume it's the transfer value that has increased by the 600 which on the face of it does seem as though the actuary has reduced transfer value calculation assumptions to favour the employer and / or take into account the funding deficit.

In your shoes I'd get an IFA to do a transfer value analaysis (TVA), maybe it's worth it maybe not but even if not do a TVA annually till retirement.

Edwin_starr

£600 pounds has been earned in by my pension in a year if i had took my pension i would have had 25.000 interest approx 1.200 .
money from pension after tax 4000+interest MINUS the 600 = 4600
13 years till im 65 =60.000 i make it i will be over 80 before i break even do you agree
thanks

Edwin_starr

£600 pounds has been earned in by my pension in a year if i had took my pension i would have had 25.000 interest approx 1.200 .
money from pension after tax 4000+interest MINUS the 600 = 4600
13 years till im 65 =60.000 i make it i will be over 80 before i break even do you agree
thanks

Schnorbitz_2

Edwin_starr wrote: »

the company have put in 19 million but it still has a shortfall of 64million

Hello,

It sounds as if you had one of these statements listing the actuary's "best estimate" position of the pension scheme's funding. (My Dad rang me to ask him to explain the statement for his pension scheme - and it was one of my proudest moments being able to help him!)

You say you Scheme has a shortfall of £64 million, but if you work for a massive employer and the overall amount the company needs to pay everyone's pensions is in the billions, it's not that much of a fraction. However, if you work for a medium-sized employer, and the total amount needed is more like £300 million, that's quite a sizeable shortfall.

Does your statement say what the total scheme liabilities are? And is the £19 million just a one-off payment, or is your company going to repeat that for several years?