Case Study 2.

Consolidating the Pension arrangements

Mr W approached EBS as he was starting to consider his retirement plans and was aware that his pensions were, in his words, ‘all over the place’. He is married and in his early fifties, with plans to retire in the next five to ten years. The couple have no children and they want to have a better understanding of what they have and how they could use it to fund their retirement at their chosen pace rather than be constrained by outdated fixed income arrangements.

After the initial meeting, when it was agreed that EBS could help them, Mr W then supplied letters of authority covering 9 individual pensions he had found. These included policy documents and paperwork from long forgotten companies such as Provident Mutual and old products such as a Free Standing AVC.

EBS took this away and did a full analysis of what was on offer. One of the initial problems was working out who now owned many of these companies. For example, Provident Mutual was bought by Norwich Union, who then changed their name to Aviva and it proved challenging finding members of staff at Aviva who remembered these companies let alone had knowledge of these somewhat complex legacy products.

Some of the policies had penalties to transfer, but further analysis found that the charges were so high on the contract that it was better value to pay the penalty and transfer out, than remain invested in the old contract. Others has grand titles regarding Bonus accumulation, but on closer examination, they had actually offered very little bonus at all in the last 10 years.

However, the key factor was that a lot of the old contracts had no ability to use the excellent ‘Pension Freedom’ options that became available from April 2015.

Mr W had already expressed that the flexibility to draw the benefits as and when they were needed were very important and so the decision was made to consolidate the bulk of the contracts into one easy to use proposition. This then enabled him to see exactly what he had, and what benefits could be drawn from them.

Mr W is still working and still funding his new Pension proposition. Most importantly, he is now happy in the fact that he has a clear route to his retirement, with a contract that is fit for purpose and managed by professionals.

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