Cash some after opting out of Pension(s)

[Creepy]

I am 51 and I approached a financial consultant about my pensions. After much thought and advice I have decided to go for a lump some and re-invest the remaining 75% in another company losing about £1,300 pa on my pension. The question is how long does it normally take to see the cash sum ? its now over 2 months since the ball started rolling and the advisor has said that the post strike had slowed things up a bit but still no news of the cash sum yet. I have had a welcome onboard letter from the new company (liverpool & victoria) The financial advisors are FSA registered and I have heard no negative reports.
is this normal or should I investigate ?

[Captain Spod]

You really need to find out how long the ceding company (the one currently holding your funds) has had the authority. Unfortunately this is only available from your adviser. If I were you I would ask the adviser to tell you when the paperwork was sent to the ceding company as you are about to start a compaint. Tell them that you are an eligible complainant dissatisfied with the service related to a regulated product, they should recognise that wording and pull their finger out!

[Hymie]

Getting hold of your pension early – miss selling.

I was in a similar position to you a year or so back – and looked into getting hold of 25% of my deferred company pension pot and having the rest invested (as allowed by the pension rules).

The company I contacted advised me that my remaining 75% pension investment would have to grow at 13% p.a. to give equivalent benefits to my deferred company scheme.

Clearly this is unlikely, although there are clear benefits of getting hold of the 25% ASAP, if my remaining investment needs to return 13% p.a to match my company scheme – it would clearly be a bad move to take the 25% now (I will be able to take my 25% once my company pension scheme pays out).

You should have been given a similar projection (how much your investment needs to grow to match your current pension scheme). If not, or the required growth is in excess of 10% p.a., I would make sure I kept all the paperwork – so that when your new investment vehicle (pension) comes nowhere close to what your company pension scheme would have paid – you will be part of the next financial miss selling fiasco, and have evidence to support your claim (for miss selling compensation).

[Captain Spod]

Me again. Not keen on Hymie's answer. The question realted to pensionS so I would guess that thses are not occupational schemes. Also the financial adviser will be smart enough to include wording such as "I pointed out that your investment will need to grow at a million per cent per annum to equal what you could have achieved by waiting, but you felt that immediate access to the 25% cash was your priority" thus putting the onus on the applicant. The next big miss-selling scandal will actually be about SIPPs, not early access to pension funds.

[Whoever]

I think the Over 50's have until April 6th next year to withdraw a cash free lump sum from a pension scheme. After this date you can't withdraw it until you're 55 so as long as the money has been taken out by then, you should be OK. But you don't say what type of investment you are going into with Liverpool Vic. Is the scheme from which you are withdrawing a Final Salary Scheme? if so I would think very carefully indeed about moving as these schemes are like gold dust now and worth staying in. Also, are your company making contributions to your pension? Will they continue to make contributions to your new scheme? I would be VERY WARY about this move and perhaps get a second opinion although there is no reason why you shouldn't take the cash if you feel you might need it because of unemployment or redundancy over the next five years. You will probably have to pay some hefty up front charges to enter into the new pension scheme too, as well as hidden commission to your Financial Advisor, who hopefully wasn't employed by a bank as they can only offer products from their own range which are often pretty abysmal and not necessarily the best ones for your needs. Also, I think any growth projections provided by your Financial Advisor may need to be taken with a huge pinch of salt given than we are in a recession and the economy is not set to start growing again substantially for a considerable number of years.