Marc Gander - The Consumer Survival Handbook

A 220 page introduction to all things consumer related by our own BankFodder.

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  1. #1

    Default Annuity funds no more :-(

    Does anyone have points of reference for failed pension schemes they could nudge me in the direction of please?

    No urgency (I'm 46 so it'll probably all change before I get there)

    For a little background, I paid into a scheme for 20 years to a total of something iro 60k, my employer ( I thought) was matching same but apparently took a few years off here and there and paid nothing into the scheme during its final 4 years.

    I received a notice from the trustees and L&G who now manage the fund about 4 years ago advising it was only able to sustain those already in retirement or due to retire within the next 2 years.

    Do I have any recourse to recover anything at retirement?

  2. #2

    Default Re: Annuity funds no more :-(


    Contact the Pension Advisory Service and they should point you in the right direction. Pensions are a bit of a minefield.

    There is a pensions regulator who can look into complaints.

  3. #3

    Default Re: Annuity funds no more :-(

    Hello there.

    Do you know what type of scheme you paid into please? Was it final salary [defined benefit] or money purchase [defined contributionicon]?

    And over the years, did you receive any correspondence about employer contributions and whether they were being paid or not?


  4. #4

    Default Re: Annuity funds no more :-(

    Morning UB & HB, thanks to both of you for looking in.

    I think I'm going to have to trawl through the loft to be sure, I was 20 when I joined the scheme and whilst I've got a fair idea of who, what, where and when I'm not 100% on the facts.

    From memory there were 3 schemes all contributionicon based all with differing levels of benefit, death in service, widow pension etc. Scheme 1 was 3%, 2 was 4% and 3 was 6% with additional vc's capped at 5% and employer contributions capped at Max 6% match.

    I paid in at 6% for the first ten years and 9% for the latter 10 years. I seem to remember receiving notices from the trustees perhaps 3 or 4 times over the whole period advising there would be no employer contributions in a given year.

    Will do some digging during the week and see what I can find.

  5. #5

    Default Re: Annuity funds no more :-(

    Hi Honeybee & uncleb

    Hopefully you'll spot this and have a better understanding of it than me

    After much pestering it turns out there was an error in the data held by L&G, it seems an issue I had with national insurance prefix threw a spanner in the cut a long story short my employer at the time recorded my NI number NM instead of NP and my contributions went walkabout for the first 12 years of employment!

    Have now discovered I joined the scheme on my 18th and left employment (and the scheme) when I turned 37... so 19 years total.

    Anyway... I finally have a breakdown of pension benefit for normal retirement date which is made up of 4 elements

    1. Pre 88 secured minimum pension 52.08
    2. Post 88 secured minimum pension 1579.92
    3. Standard revaluing pension 5285.76
    4. Post 97 pension 2088.72

    Total at date of leaving service in 2004 = 9006.48

    It then goes on to state that 1 & 2 grow at 6.25% compound per annum from 2004 to retirement, then at 3% compound thereafter.

    3 & 4 grow at RPI to 2010 then CPI thereafter to retirement age ( I think this has averaged circa 2.5% since 2004?), then at 3% compound thereafter.

    I had a brief chat with them today regarding up to date figures and they advise they'll be writing back to me within the next few days.

    Not sure what tools there are available online to compare the values with the known amounts I paid in, do these look reasonable?? I thought they looked OK but that may be more to do with what I thought I didn't have a few months back

    Also contracted out of serps and been self employed for the last few years so not exactly sure what entitlement I'll have to any state pension.

  6. #6

    Default Re: Annuity funds no more :-(

    Beyond my level of knowledge unfortunately. You need someone who deals with pensions on a regular basis to answer this.

    If you google pension calculators there are many, but I am not sure whether any would help.

  7. #7

    Default Re: Annuity funds no more :-(

    Agree with the advice to talk to The Pensions Advisory Service. Very complex area, impossible to answer properly here. I question whether it has anything to do with Annuities, it seems to be about an occupational pension scheme. It sounds as if this might have been a defined benefits (final salary) pension scheme because employers usually only take 'contributionicon holidays' in those sort of schemes. A common reason for scheme members being told what you've been told is because the employer has gone out of business leaving the pension scheme underfunded. If that's the case there is a government fund called the Pension Potection Fund designed to take over payment of some of the benefits (up to certain limits). This might be relevant to your situation - or it might not. Get specialist advice, and do it now - don't wait until you're 65!

  8. #8

    Default Re: Annuity funds no more :-(

    Thanks both, no worries.. I hear what you're saying.

    Re: annuity; its been the better part of 30 years so my memory is a little hazy. I did manage to find the original bumf and it was def an annuity purchase scheme at inception although I'm aware the scheme changed several times over the years (what I did with the paperwork I haven't a Scooby) Defined benefits (final salary) were only available to management in the early years. My policy is described as a part of a bulk annuity agreed between L&G and the trustees. The business sold up its UK interests in 2007 so no longer trades here.

    Had a chat with TPAS who advised what info to ask for and why so they can provide me with a little insight into what's gone on and whether everything is now an accurate representation, very helpful people.

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