Forum

Workplace Pensions And MS

Hi I had to retire from work about five years ago but I payed into several workplace pensions while I was working.Someone was telling me that if you had a critical illness such as MS the pension provider may award you extra annuities so should I be telling them of my position now even though I’m not due to officially retire for another fifteen years.I was wondering if anyone else has been in or is in the same position as me.Thanks Dave.

I was medically retired last year, my works pension was awarded in full and enhanced to what it would have been had I been able to carry on working to my correct retiring age. If you contact the providers I’m sure they will able to advise on what you should be doing.

Good luck

Jan x

Depends entirely on the rules of the scheme, Dave.

Some have very strict rules, and insist you must be unable to work at all, in any capacity - not just at your former job. I’m not sure whether you might (hypothetically) be considered capable of accepting a lesser job, even though you haven’t in reality.

Some will not pay out if they consider you would still be employable, albeit not in the same capacity as before.

Also, be careful, because new rules introduced recently mean that you are no longer forced to use you pension pot to buy an annuity.

For many people, an annuity - or at least putting some of it into an annuity - will still make sense, but be aware it’s no longer the automatic and only choice, so even if any of your existing schemes will pay out early, don’t be too hasty to take an annuity, and even if you go for that it in the end, don’t assume it has to be with them! Most people can get a better annuity by shopping around than sticking with their default provider, but not everyone is aware of this - they assume you have to stay with whoever you had the plan with.

You might want to try the Pensions Advisory Service. They are a free, independent service. Contrary to their name, I’m not sure they are actually authorised to “give advice” - as in: “tell you which option is best for you”. However, they would be in a position to explain the different options there are, so that you have enough information to make your own choices.

Whatever you do, don’t just snap up the first annuity anybody offers, as if you have multiple small pots from different employers, you may do better by amalgamating them, and taking the lot elsewhere. You can also usually take up to 25% of it tax-free as cash. I don’t know if this concession is affected at all if you would be taking it well before your nominal retirement age. Another thing the Pensions Advisory Service should be able to tell you.

Tina

Hi, I worked for my local council for 15 years. I retired on ill health aged 45.

I got my pension immediately, at an enhanced rate.

pollyx