Q. I am 55 in August and have been looking at the new Pension Flexibility rules. I do not work at present, but have a deferred pension in a Final Salary scheme. Can I get the value out from it?
A. Unfortunately I do not have enough information to answer your question definitively. The new rules were introduced because of the low level of annuity rates, which don’t affect the members of final salary schemes, where the income level is guaranteed. The employer companies behind the schemes are therefore the ones who are affected by more expensive annuity rates, not the members. You may be able to draw benefits from the scheme, probably with a lower pension reflecting the longer payment period, but not always. If the scheme is one provided by Government, you are not permitted to transfer to a personal pension, where the new freedoms are focussed. If your scheme was backed by a private employer, you will need to take financial advice before you are allowed to transfer it if the fund exceeds £30,000. Even then, it may well be that you are better drawing benefits from the scheme. The new flexibility has been described by some as offering the freedom to pay as much tax as you like on your pension, as any withdrawals in excess of 25% of the fund will be subject to tax at your marginal rate. If that is concentrated into a single year, that could mean a much higher tax bill.
Q. I have been going through my late husbands papers and I have found 2 old Premium Bond certificates worth £7 that were bought in 1958. This was about 5 years before we were married and moved to our current address. There is no name on them although I presume they were his. How can I find out if they were his and are still valid?
A. I suggest that you complete a Tracing Service form that is available on the National Savings & Investments website and forward it to National Savings & Investments, Glasgow, G58 1SB quoting the Premium Bond numbers, and enclose a certified copy of your late husbands Death Certificate and if you have it a Grant of Probate. They should be able to verify if in fact they were your husbands Premium Bonds. If they are then they should then be able to pay you the £7 plus any possible unclaimed prizes.
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