Early Pension Release
John has an old pension from when he used to work for his local council; it is a Local Government Pension, which has a Cash Equivalent Transfer Value of £40,000.
- John Smith is employed on a salary of £24,000 a year
- Married to Joan who works part time on a salary of £7,000 a year
- John is aged 57
- No dependents
- No savings
These are extremely good pensions with guarantees of what they will pay at retirement and normally John wouldn’t even consider taking benefits from it early, however, John is behind on his mortgage and owes the company £4,000. He also has a bank loan of £5,000 and an overdraft of £1,000.
All these debts came about because he was made redundant over a year ago and he has only just found new employment. He and his wife did have some savings but these have all been used up. He is making payments on his mortgage and bank loan now but the mortgage company are saying that if he doesn’t pay back his arrears they will reposes his house.
John and Joan have tried getting a consolidation loan but can’t because they have a bad credit rating; they’ve even spoken to Citizens Advice but they couldn’t help. None of their friends or family are able to help them either and every bit of money they earn each month goes out again just on living. It’s not as if they have luxuries they spend their money on that they could cut back on.
They have basically tried every avenue possible to try and solve their problem and it is only because they have exhausted every other option that they are now considering using John’s pension.
John is unable to take benefits early direct from his Local Government Pension Scheme so he is going to transfer it into a Personal Pension. He is then able to release 25% of the transfer value as a Tax Free Cash Sum, which is £10,000, leaving the rest of the money invested in his Personal Pension to take as an income when he eventually retires.
Transferring his pension means he has now lost all the very valuable benefits and guarantees that he would have got with his Local Government Pension Scheme and there are charges and costs involved with the advice he has been given and to set up the new plan.
However, John will still get a pension when he retires, albeit smaller than he would have otherwise got, and he and his wife can stay in their home and clear all their debts.
He made sure he fully understood what guarantees he was giving up and all the costs, charges and risks he would be taking by going ahead with Early Pension Release, this enabled him to make an informed decision.
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From the moment I went on to the website with Grove, right to the end of my pension dealings. They've acted in a very professional way with myself, I would recomend them to any person who - like me - needs much needed help on pension release. Well done to everyone at Grove, you deserve a pat on the back, thank you.
Your staff gave me so much relief and I would like it known that your staff are helpful, understanding, and make the whole process easier than I thought it would be. I am so so happy to have put this in your company's hands.
The advisor explained everything and took time to make sure I understood what he had said. Service provided prompt information clear and easy to understand. Staff polite at all times. Everything they said would happen did in time frame told.
Grove Pension Release provided a very proficient service regarding my pensions review and pension release. My future pension needs have been fully reviewed and look forward to your support and working together in future years.
I would recommend your services to anyone. A good job well done. Thanks.
Pensions are an incredibly difficult subject to grasp but the team at Grove Pension Solutions went out of their way to explain, in plain English, the pro's and con's with regards to the pensions even if it meant that they wouldn't get as much business. They really did put the client first which is a refreshing change to the financial culture of today. I was very happy with the service and satisfied that my pensions are in safe hands.
The Grove Pension Release company are very helpful who go through every aspect step by step so that you understand. ... The service you get is A1 and the staff are polite and helpful in every way. The response and service I got was second to none.
You were the only company to explain it (advice) to me in a way I could understand ... I contacted several IFA's and they were all very unhelpful. ... I am delighted I chose Grove, very professional, polite company. Thanks so much!
Very helpful & informative staff who understood my situation & why I had to release funds. I was informed that it could be a bad decision to proceed & was put under pressure not to, which doesn't make sense as Grove wouldn't make any money.
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