cashing in pension plans

[boomster]

I have 1 year left of my pension plans (3 with same company). I would like to cash in a fair chunk of it now. Can I do that and up to what percentage? Thanks in advance.

[factor-fiction]

It depends on your age- if you are under 55 the answer will be no

[factor-fiction]

If you are over 55 I think it will depend on the terms of your policy

[buildersmate]

I'm unclear what you mean by '1 year left' - one year until you plan to retire?

Government rules allow up to 25% of a pension pot to be taken as a lump sum, unless the amount in the pension pot is a trivial sum (up to £18k, in which case you may be able to take up to £18k).

But these are the Government limits and it is your scheme provider who you need to talk to to find out if this is permissible under the terms of your scheme.

Pensions are to provide you income once you stop working - taking a lump sum and not investing it in something else to provide income could leave you in proverty in your older age.

[factor-fiction]

Here's an extract of the rules for Aviva pension plans, which may be typical of those available:

"What's your commitment?

With a personal pension from Aviva you're committed to:
-Making either one single payment or making minimum monthly or yearly payments until your retirement date.
-Using the majority of your pension fund to provide an income when you decide to retire.
-Investing for the long term; you won't be able to access your pension fund until you retire.

[boomster]

Thanks guys, I'm sorry, I didn't make myself very clear by not giving you more info. My situation is that I have a plan (well 3, but with same company, different dates of starting them, first 2 hardly any time, the third a few years later. Now, the thing is I was in good health and in work when I took out the plans (C1976) and payment was monthly paid directly by my then employer. I left this employer in 1984 and naturally payments into my funds ceased. I just left it at that and got yearly statements and to be quite honest the capital was accruing fairly healthy interests. To cut a long story short, in 2000 I couldn't work anymore due to serious illness, which is one that is degerating nature, I am labelled, "disabled" lol. On a whim, the other day, I rustled through the dusty ledgers in our so-called 'filing' cabinet gumph, thumbed through very old papers, blah, blah, found my statements and closing date for the policies and for receiving payment was next April 2013! I've just turned 59, so I imagine it has been set for my 60th birthday and not retirement age of 65. The insurance/pension people are, as far as I am aware, not knowledgeable of my illness. (Not that it matters, I hope.) The thing is I would like some of the money due to me in advance, because my wife is working hard, out in all weathers and we feel she needs a decent 4-wheel drive motor, particularly in the winter for a new career as a dog trainer/behaviourist. This is her second year of actual practise, but last year she got stuck twice in that treacherous Jan/February ice & snow. Sure, it could wait, but it's nice to know these things in advance isn't it? Now, where's me Auto-trader got to? LOL!

[buildersmate]

Then you should be able to do this.
The Government insists that such pensions cannot be drawn on until after 5 years old (you are older).
The trustees of the scheme should be approached to find the value(s).
You seem to have a Defined Contributions scheme (one where the pension at the end depends on the contributions made and the performance of the investments made with the contributions. If you take the benefits before age 60, the projections you had last year will be wrong (because you are taking the benefits early) but you should be OK to do it.

[buildersmate]

55 years old (of course)

[EDDIE51]

I had 2 pensions like yours, I took the 25% cash out and get the rest as a monthly pension.I was 58 at the time. I got around £8000 cash and a pension of £110 a month. Your pension provider will give you an estimate of the amount of cash available and the pension both with and without cashing the 25% .

[twix123]

When you eventually decide to take out your annuity(ies) if your illness should be 'life shortening' ensure that your provider will give 'life impaired' policies, which pay out at a higher rate due to the expected shorter payment time scale.

[boomster]

Thank you to everyone who has contributed a rep;y - they are all very informative and very useful. I'll let you know how things turn out as soon as I am able todo so. A BIG thanks to all. :)