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occupational pension reduced by SERPS - I'm confused
Menucha
Posts: 24 Forumite
My husband retired on ill health in February 2006 - he was 61. He gets a reduced occupational pension (final salary pension) because he hadn't completed the full number of years and also receives long term Incapacity Benefit.
However - when he gets the State Pension at 65 the Occupational Pension will be reduced by almost £3000 a year - it seems to be something to do with SERPS.
In effect this means he will actually be worse off than he is now.
This doesn't make much sense to either of us.
Has anyone else heard of a pension like this? Can the Pension Providers do this legally?
However - when he gets the State Pension at 65 the Occupational Pension will be reduced by almost £3000 a year - it seems to be something to do with SERPS.
In effect this means he will actually be worse off than he is now.
This doesn't make much sense to either of us.
Has anyone else heard of a pension like this? Can the Pension Providers do this legally?
0
Comments
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Has anyone else heard of a pension like this?
A lot of final salary pension schemes.Can the Pension Providers do this legally?
Yes. It's the way many schemes work with the interaction with the state pensions depending on whether they are contracted in or contracted out of SERPS/S2P.
Either way the individual doesnt end up worse off as its more or less cost neutral.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0
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