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  • FIRST POST
    • steveh6874
    • By steveh6874 30th Sep 18, 8:57 PM
    • 10Posts
    • 2Thanks
    steveh6874
    frozen pension advise please
    • #1
    • 30th Sep 18, 8:57 PM
    frozen pension advise please 30th Sep 18 at 8:57 PM
    Hi everybody i need some pension advise please , i have a frozen pension of 23.500 it is a money purchase pension with a GMP underpin Should i transfer this into my current workplace pension where i have a bigger fund
    I dont really understand what the frozen pension is really and if it as any special features or anything but i just feel with it being a low value fund i wouldnt gain anything much from the features anyway,

    I wont be charged a transfer fee if i did transfer so i am seriously considering transfering

    Any advise would be very much appreciated

    Thank You
Page 2
    • xylophone
    • By xylophone 13th Oct 18, 7:40 PM
    • 26,923 Posts
    • 16,071 Thanks
    xylophone
    I had not got the impression that this was a S32 Policy.

    I had thought that you were a deferred member of a Money Purchase Scheme with GMP underpin?



    Can you clarify - what is the MPT Plan?

    Do you have a Pension Scheme Booklet?
    • xylophone
    • By xylophone 13th Oct 18, 9:02 PM
    • 26,923 Posts
    • 16,071 Thanks
    xylophone
    I have to say that if they must guarantee to pay you a pension of around 200 a month at age 65 and that they also pay a lump sum on retirement in addition to the pension and that there is also a widow's pension the transfer out value of 23,622 seems very low.

    Do you have a scheme booklet? If not, you might ask for one.

    If you do not transfer out and take a pension from the plan at age 65, how does the pension increase in payment (a) if it is all GMP or (b) if it is all scheme pension? Read the Scheme Booklet and if not clear ask the administrator.

    You might benefit from a chat with TPAS.

    https://www.pensionsadvisoryservice.org.uk/
    • steveh6874
    • By steveh6874 13th Oct 18, 10:24 PM
    • 10 Posts
    • 2 Thanks
    steveh6874
    Been trying to get all the information i have together and it is as follows



    the kind of pension you hold is a money purchase pension with a GMP underpin

    your benefits within the plan consist of defined contribution DC funds

    money tier investments total 23.622
    the GMP underpin is the minimum amount that we are allowed to pay upon your 65th birthday {GMP age }
    upon retirement your GMP fund is converted into a pension per annum , if the pension per annum provided by the MPT fund is lower than the GMP payable then the underpin bites and benefits would not become payable untill the earliest of age 62 {scheme retirement age }


    for example

    if the GMP underpin was 1000pa this would be the minimum amount we could pay from age 65 ,if the MPTfund was to provide a pension of 800 pa we would be unable to pay you before the scheme retirement age of 62, from age 62you would receive 800 pa and once you reached aged 65 the pension would increase to 100 pa in line with the GMP payable
    if the MPT fund was to provide a pension of 1200 pa {after early retirement factors ad been applied }you would be able to take this pension prior to the scheme retirement age but not before 55
    as well as your pension the plan also provides an additional lump sum upon retirement and the plan will provide a spouses pension of 50% upon your death



    as the GMP at date of leaving was pre 88 59.28 and post 88 105.04 and the revaluation is fixed at 7.5% the GMP at state pension age would be pre 88 861.12 and post 88 1525.68 totalling 2386.80

    the document shows that your current transfer value 23,525.87 is higher than the GMP payable 20,622.34 for transfer

    the NRA for the scheme is age 65 however the members pension age is 62 allowing members to take scheme benefits unreduced , if the pension is lower the GMP the pension will increase to the GMP from your 65 th birthday , for pension to be taken prior to 62 the scheme pension must be higher than the GMP payable

    the spouses pension pension is payable in retirement as 50% of the full pension , in deferment a widows GMP is payable with excess payable as a discretionary lump sum , this does not affect the members pension

    we are unable to project pension benefits more than 6 months in advance so we are unable to provide a quotation for your 62 nd birthday



    thats everthing i can find about the plan that they have provided
    thank you
    • xylophone
    • By xylophone 14th Oct 18, 12:10 PM
    • 26,923 Posts
    • 16,071 Thanks
    xylophone
    if the GMP underpin was 1000pa this would be the minimum amount we could pay from age 65 ,if the MPTfund was to provide a pension of 800 pa we would be unable to pay you before the scheme retirement age of 62, from age 62you would receive 800 pa and once you reached aged 65 the pension would increase to 100 pa in line with the GMP payable
    1000 per annum?

    My comments in 22 above still stand and I think that you need answers to these questions.

    As I suggest above, a chat with TPAS might benefit you - you might also seek an interview with Pension Wise although the scheme as described does seem closer to DB than DC.

    In essence however, do you think that the transfer value offered adequately compensates you for foregoing the GMP/lump sum/widow's pension/ (indexation/escalation if available)?
    • steveh6874
    • By steveh6874 14th Oct 18, 12:33 PM
    • 10 Posts
    • 2 Thanks
    steveh6874
    thank you xylophone youve been very kind and helpful much appreciated , you have given me a lot to think about

    i am going to book an appointment with pension wise and request a full detailed report on my scheme from the providers outlining all my benefits
    Thank you
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