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In a recent interview with Financial Consultant Robert Grattage, we asked him the questions most of our clients ask when needing advice from our Wills, Trusts and Probate department.

I don’t need my Pension Monies at the moment. What are my Options?

A.     If you have a defined contribution pension, then there are several options you have. Normally you would be able to take these options at age 55 and usually you can take 25% of your pension fund tax free.

  • You could leave your pension fund completely untouched to have there when you actually need it, using the options below (or taking it all in one go, remembering that there will be tax implications of course)
  • You could take small amounts from your fund over time until it has been used up
  • You could use the money to buy an income for life – A Guaranteed Income Annuity – for as long as you live.
  • You could invest your pension pot to give you a regular income, the decisions being on how much you want, when you want this and for how long.
  • And of course you could mix and match the above if you have a pension pot big enough to do this with. (Note that your options will depend on what the rules of your pension plan allows-not all plans offer the full flexibility.)

Can I take my Pension before I Reach 55?

A.     Normally the answer to this is no however there are some circumstances where this might be possible depending on your pension provider.

  • If you are very ill and cannot work.
  • If you are very seriously ill and your life expectancy is less than one year.

It needs to be stated that if you are getting calls about taking your pension early you need to be aware that there are firms who are scamming people out of their pensions so you do need to be very diligent and ensure firms you are going to work with are authorised by the Financial Conduct Authority (FCA). You can check the register on the FCA site. There are also tax implications so it is very important to get the right advice.

My father has just died. What Happens to his Pension?

A.     This will very much depend on how the pension was set up and how he was receiving it, if he was.  Most providers allow for any beneficiaries to receive the pension; it does not just have to be the spouse or civil partner. Obviously if any cashed in part of the pension is in your father’s account then this forms part of his estate.

If your father was taking an income i.e. a guaranteed income (annuity) or adjustable income, then beneficiaries might be able to inherit the pension tax free if your father was under 75 years of age. If he was 75 or over, then this will be taxed as income in the hands of the beneficiary, and could well be liable to income tax. If you are inheriting your father’s pension in this case, then you might be able to use it to buy yourself an adjustable income pension or an annuity.

Much of this depends on how your father and the pension provider set up his pension.

If there is still money left in your father’s pension pot then, again if he was under 75, beneficiaries might be able to take out the lump sum or retirement income tax free.  There are other specific rules that apply so it is important to take advice from someone who is qualified to give you this.

I know I have a few Pensions but I don’t seem to have all the paperwork. What can I do?

A.     If you want to take advice you will need to have all your paperwork with you when you see a financial adviser. (Please remember to check with the Financial Conduct Authority’s register to ensure they are bona fide advisers)

There is a government service that can help you trace your pensions called the Pension Tracing Service.

If you are trying to get details of a pension for a deceased relative, then there is a letter on the Money Advice Service web site under the section Find Out About Other Pensions which is very helpful.

Your financial adviser may also be able to use his/her support team to help locate current pension details too, so long as you let them have a signed letter of authority for each of the potential providers.

Welford Place Wealth Management

Bray & Bray are not authorised by the FCA. We are allowed to provide only certain limited services in relation to investments, in respect of which we are regulated by Solicitors Regulation Authority (who operate a complaints and redress scheme), and we may refer you to an authorised person in any event. We would therefore recommend that you allow us to refer you to Welford Place Wealth Management or another firm of Financial Advisers, if you prefer.

We are part owners of Welford Place Wealth Management, Financial Advisers and we would be very pleased to introduce you to them if you wish. Welford Place Wealth Management is not regulated by the Law Society.  Customers of Welford Place Wealth Management are therefore protected by the Financial Services and Markets Act rather than the statutory protections attaching to the clients of a Solicitor’s practice.

The value of pensions and the income they receive can fall as well as rise. You may get back less than you invested.

Inheritance Tax Planning is not regulated by the FCA.

Welford Place Wealth Management is a trading style of Ashwood Law Professional Link (JVC1) Limited, which is an appointed representative of Quilter Financial Services Limited and Quilter Mortgage Planning Limited, who are authorised and regulated by the Financial Conduct Authority.

Contact us to discuss any enquiries you may have or feel free to pop in and see us at your local office by clicking on the links below.