retirement due to ill health

ken from bexley

Hi, I was reviewing my pension arrangements as I am getting to the age when I could , or I thought I could retire early.
I have a small pension from IPC from thirty years ago that stated I could draw on my pension from 50 to be changed to 55 from next year. ( Goverment law)
and it stated that due to ill health this is normally considered!......
I have a permanent 'disability,' as well as 'uncontrolled hypertension' and work and have done in the media. so have not been working full time as the doctor advised me not to, as the stress is pretty intense....
( I have worked 4 days) for the past 18 months, .......Now I find that I can only retire with this company if i can do 'NO work'.... not my chosen profession......

I Have checked out the position, and it seems to vary depending on the pension trustees......
The pensions advisory service, state.......
'In recent years this has become an increasing area of dispute for scheme members as companies and trustees tighten up their procedures for granting such provisions due to the cost involved.'
The only answer seems to transfer the old pension to my current employeer, who allows you to retire at 60, which will mean a 'disadvantage' in the financial sense........or go to a dodgey loan against pension company, but I find these people generally a bunch of sharks.......
Just wondered if any one knew a specialist or had an experience of any of this in the recent past...

Seems a typical 'fudge' and a bit of a mess ..... yes you can retire at 50/55. but you cannot have a pension, or draw on it........till you are 65/68/ 70 plus , unless you have a terminal illness, and even then it is not certain....( I have two colleagues who have cancer inoperable but still work, out of choice!)

any constructive comments welcome

thanks

I am talking private pensions that are transferrable, be good to hear of anyones 'actual' experiences'

stilladdicted

Our experience is that if they can find a way to screw you, they will. Pensions = legalised theft as far as we're concerned. The Pensions Ombudsman though is a good place to start as each case is different and on the phone, if you get someone who knows what they're talking about, they are helpful.

charltonkeston

Cant really help as I know as much as the next chap about pensions.
But the bit about your colleagues who have cancer struck a cord with me. Some years ago I also had a couple of work colleagues who both had cancer. They too choose to work on till the end. Both of them knew what lay ahead of them. They were quite brave , (I thought) , in making the decision not give up work but the decsion was really made for them. Death in service ment more to their families financially than a medical retirement. Seems the average man gets screwed no matter what.

Kap10

Ken these things are so complicated that I think you need to consult a pension expert, someone on here must know oner they can recommend.

ken from bexley

Thanks guys......
I am going to consult an expert..... or at least someone who specialises in these matters, you can see the wording has changed from the pension scheme from
'possible to retire' giving the idea that if you wanted to or had an illness/decent reason it would be considered to...... 'unless you cannot do any type of work' and your GP has to certify that, and they still may challenge that..... that is what is concerning myself

Thank god I only have a small contribution with Reed/Elsevier, formerly IPC so the amounts are not life changing, at the moment the annual amount does not even pay my community charge, but my concern is that the next year or so I can see whatever goverment raiding this 'pot' whoever is in power as people really do not think about pensions until they are about to retire, then it is too late.

I did work in the financial press so I do know/or did know a little,( always a mistake) and have spoken to a couple of contacts, but as people say it depends on the trustees and circumstances of the applicant. A few people are of the opinion that whoever is in power will scrap universal state pensions if you have savings over a certain amount of income/pension to 'claw back' the goverment's liability, so it does not look good for the future, unless you have such a large pension pot, that you can be independent of state help and inflation proof!... I guess you cannot assume anything, especially when it comes to these matters.

Covered End

Ken, you can at present draw a pension from age 50, although as from 06/04/2010 the age is increasing to 55. Therefore, if you are already aged 50 or will be before 06/04/2010, you can draw your pensions. (This is nothing to do with ill health)

As far as retiring and drawing a Company pension due to ill health, I would say that that depends entirely on the Company Scheme rules.

ken from bexley

You are correct Covered end...... and in any case I am over 55 by a few years, my issue is that this pension fund have 'interpretted the rules , so that going from 'possible' to ,not able to do ANY job, not just your 'profession' seems a bit of amove.......

I am not alone in this, and the way things are going although you can retire at any time, you do not have a right to draw a pension, reduced as it may be with this particular company, so you are free to retire, but not free to receive a pension, even though your GP states you are unfit to work in your profession, the profession that I have always worked in.....

I think the retirement age will be a major political issue in the election, as the Tories are stating they wish to move that to 67 plus, and although woman's retirement age goes up to 60-65 over a number of years, pressumably this will mean 67 plus as well as it discriminate against men, and woman live longer......Lord Turners reccomendation that the retirement age was not raised has already been accepted even by himself as no longer 'possible' so I guess it is back to stacking the shelves again, as I did as student 40 odd years ago, that is if I can find someone to employ me.......

Dippenhall

I am in the business and am an adviser for The Pensions Advisory Service. It really all depends on each scheme as to what it defines as "permanent" and what is a "disability". Most schemes have now adopted rules which require evidence that 1) you are unlikely ever to recover and 2) you aren't capable of doing your own job or any other job in the company (doesn't mean a job you could do has top be available). The reason ill health pensions are so restricted is because they are hugely expensive for the scheme. Firstly it is not reduced for early payment (a pension payable from 65 but paid from say 55 is paid for an extra ten years so for a "normal" early retirement would be reduced so that it is financially neutral in value). Secondly some schemes give you the pension you would have earned for the years you will miss through ill-health. It can be a massively generous package and I regularly saw modest ill-health pension adding £150k - £500k of additional cost to a company scheme.
The government raised the age at which you were allowed to take a "normal" early pension because they needed to do it for civil servants (to reduce the ependiture which comes out of taxes) and decided to pretend it was a good thing for everyone (it has no cost impact on companies because they have already put the money in).

Biggest problem with people understanding pensions is getting to grip with value. To pay an income of £10k a year for life with 3% yearly increases from age 60 would need you to have accumulated around £225k in cash to ensure it lasted your lifetime invested so that it returned a few points above inflation. For people not in the now rare final salary schemes that is the reality of the savings gap for retirement.