Having a pension paid in all one go

My mother is 63 - she has just been diagnosed as having dementia. She has a small occupational pension which she gets paid a meagre sum of about 120 per month. When she was assessed, the Dr said her condition will mean she has got a life expectancy of around 4-8 years, but with the last few years getting increasingly worse to the point where she won't recognise people etc and become increasingly house and then bed bound. We have thought about the impact of this, to the point that we want mum to have as good as few years as possible up to the point where she does deteriate. We've been trying to work out if we can get her pension paid out all in one go so she can enjoy her last few cognitive years without worrying about having to save up for them. My mum paid into a pension fund for all the years that she did work (in between bringing up three kids on her own and in the pre-1990 years when the state cared little about "hard working single parent families" - father had died so no maintenance from him or his estate). Her pension fund when she retired was moderate and based on what she had then and her current life expactancy she is not going to get the benefit of what she paid in all those years. We're obviously not looking for a full refund of that pension fund, but wonder if it is at all possible to get a settlement value of the existing pension fund so she can enjoy it now on a few holidays etc before she gets too ill. Sorry for rambling.
Reply to
Snozelem
Bitstring , from the wonderful person Snozelem said
Short answer is 'probably not, no', although you could try talking to the company currently paying her pension.
If her problem had been known before she turned her fund into a pension, she could probably have bought an 'impaired life' annuity, which pays more for a shorter time, however she is now in 'the standard pool' with all the other pensioners, some of whom will live longer than average, and some less, that's the way the annuity funds work. If everyone dying sooner got money back, then those living longer would be poorer.
Reply to
GSV Three Minds in a Can

In a word no. She could have taken a quarter of her pension fund as cash when she retired but I do not think this can be backdated. Sorry to be blunt but pension schemes work because some pay in more than others whilst only drawing a small proportion in retirement before they die. If everyone was allowed to withdraw ''their pension fund'' there wouldn't be a fund to withdraw from.
Reply to
Eric Jones
Nope, those that lived a long time would have received more in pension payments than their fund was worth.
Only those that "took their fund" *before* the value of their pension payments had exceeded the value of their fund, would have the "value of their fund".
Reply to
Tim
Kind of makes you wonder if those people who have a family history of dying relatively young (early 70s), it is probably worth while them considering not paying into a pension fund at all and just keeping it in tax efficient cash savings which they can then draw on at the time of retirement. Obviously, that would less attractive for those currently earning in the 40% tax band.
Reply to
Wedell
In message , GSV Three Minds in a Can writes
It is an occupational pension, so it is probable that an annuity is not being purchased.
Reply to
John Boyle

But presumably she'd have been able to transfer to a private pension and then buy an impaired life annuity.
Reply to
Andy Pandy
Bitstring , from the wonderful person John Boyle said
In which case there is a faint chance that the scheme trustees might look favourably on a plea from the recipient. Worth asking them, anyway. My scheme had been known to make exceptions ..
Reply to
GSV Three Minds in a Can
"GSV Three Minds in a Can" wrote
And risk losing their tax approval?
"GSV Three Minds in a Can" wrote
For a pension as big as the OP's pension? When was that?
Reply to
Tim
Bitstring , from the wonderful person Tim said
Depends on the mechanism used to pay any uplift. Given that the scheme trustees and the company treasurer/secretary/MD etc. are an intersecting set of people, ways and means can be found.
£120/month, today .. that's got to be virtually down there with the 'trivial', no?
10 or 15 years ago, iirc. But no, I don't have (and wouldn't give) the details.
Reply to
GSV Three Minds in a Can
"GSV Three Minds in a Can" wrote
That's 1,440pa.
Pre-'A'-day (presumably OP's mother retired before April), pensions had to be below 260pa to be trivial -- so it was over 5 times too big!
[Even now that the *value* of the pension (ie not the annual amount) has to be less than 15,000, I'd still be very surprised if 1,440pa was trivial.]
Reply to
Tim

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