I’ve been helping a client to obtain a pension that arose out of an
employment that ended in 1978. He had a letter from the Pension
Administrators that seemed to give him the inconvertible right to a
pension estimated at some £2,000 p.a. (It was a ‘supplementary
scheme’, also known as a ‘top hat’.)

However, he forgot all about it and the employer in question succumbed
to a takeover, as did its new owners, ad infinitum.

Fortuitously, he discovered the letter of entitlement in January 2002
but, after a long haul, he has only recently established who the
insurer was, etc. So, at last, a happy ending is in sight. Indeed, a
very happy ending because, had he taken the pension when he became
entitled at age 65 (in 1997), he would have missed out on an
apparently huge ‘demutualisation’ windfall.

Now that you have soaked up all that, here are the questions (just do
your bestest and –yes – he will take professional advice, etc.):

1)	What would have happened to the fund if he had popped off before
taking, say, a cash option (for whatever, if available) or buying an
annuity?

2)	Would NOT making a decision (ie leaving the fund where it is) be an
option? And why might this not be attractive?

Incidentally, he’s in great shape and he has no need for either income
or capital.

If possible, he would welcome your learned opinion within a week but,
if you need longer, then that’s no problem either.

Bryan

---

Clarification of Question by probonopublico-ga on 17 Sep 2003 06:42 PDT

I should have added that he lives in England ...

---

Request for Question Clarification by jem-ga on 17 Sep 2003 07:11 PDT

Hi Bryan :)

Just confirming that I am on the case! Many thanks for the answer
time-frame, too.

Given my current bout of "heat exhaustion" from my 5K run on Sunday,
the extra time is much appreciated! LOL :)

Kindest regards
:) jem-ga

---

Clarification of Question by probonopublico-ga on 17 Sep 2003 08:42 PDT

Hi, Jem

Well, I'm still exhausted, too ...

And, as you know, I went round the course on my favourite white
stallion.

As one of the all-knowing elite, you should know that there are better
ways to travel than using your own legs.

And all for what? A tub of Flora.

Me, I prefer Benecol.

Their yoghurts are tasty, too.

Bryan

---

Clarification of Question by probonopublico-ga on 17 Sep 2003 09:51 PDT

For 'incovertible', please read 'incontravertible'.

(Or summat such word.)

---

Request for Question Clarification by jem-ga on 18 Sep 2003 06:46 PDT

Hi Bryan :)

Just keeping you updated - am still actively researching your question
and anticipate posting an answer within the next day or two.

Kind regards
:) jem-ga

p.s. <<you should know that there are better ways to travel than using
your own legs>> - well, I do quite like those personal jetpacks that
you can strap onto your back and zoom around with a la Jetsons style -
the last time I saw mention of one, the pricetag (for a prototype) was
in the region of £60k ;)

---

Clarification of Question by probonopublico-ga on 18 Sep 2003 10:59 PDT

Hi, Jem

Many thanks for the update.

I'm delighted that you can fit me in between races.

Any ambitions for the Olympics?

Bryan

---

Request for Question Clarification by jem-ga on 20 Sep 2003 00:32 PDT

Good morning Bryan :)

Further update - have now compiled most of the proposed answer to your
question.  The delay in posting is due to my waiting on one of my
contacts to confirm some information relating to part 2 of your
question (said contact is out of the country, returning early next
week).

Apologies that this is taking slightly longer than my normal warp
speed and many thanks for your patience! :)

<<Any ambitions for the Olympics?>>: yup, I plan to watch them on a
big wide-screen telly - LOL!

Kind regards
:) jem-ga

---

Clarification of Question by probonopublico-ga on 20 Sep 2003 01:55 PDT

Good Morning, Jem!

Well, I thought it was a good morning until my friend Peter (who's
staying with me) failed to surface for breakfast ...

He's ill, so all our plans for the weekend have to be abandoned.

No tiddly winks; no dominoes; no crown green bowling ...

And Lancashire are making a mess of things in their game against
Nottinghamshire.

So, the chances are that 'Latics (Oldham Athletic) will get trounced
this afternoon.

Oh, Woe is Me!

Bryan

Hi Bryan :)

At long last, an answer - hurrah!  Many thanks again for your
patience.

In response to your questions, namely;

1) What would have happened to the fund if he had popped off before 
taking, say, a cash option (for whatever, if available) or buying an 
annuity and;
 
2) Would NOT making a decision (i.e. leaving the fund where it is) be
an
option? And why might this not be attractive? 

I can comment as follows:

I have been asked by those who have assisted with this research to
highlight the fact that the information provided within the context of
this answer is on the basis of *general commentary and opinion* only
and may not necessarily reflect any rules and/or provisions contained
within your client's pension scheme.  Without exception, each expert
that I consulted (see Research Strategy below) advised your client to
contact the insurer directly and request a copy of the applicable
rules relating to his pension.  They also suggested that your client
specifically address his questions directly to the insurers who will
either respond accordingly OR direct the questions to any trustees of
the pension scheme, as applicable.

Question 1: What would have happened to the fund if he had popped off
before
taking, say, a cash option (for whatever, if available) or buying an 
annuity?

The short answer to this very much depends on the rules of the pension
scheme which, as noted above, should be available from the insurer. 
The general consensus is that if your client had "popped off" before
taking, say, a cash option *whilst the employer was still in
business*,then in all likelihood, a lump sum would have been payable
to his dependants.

On the assumption that the pension scheme is now *in the hands of new
trustees* (i.e. no longer being administered by your client's previous
employer), then the situation might be slightly different.  For
example, if your client "pops off" now before taking, say, a cash
option, then it is in the trustees' discretion as to how they would
administer the pension (ideally, you should check the rules of the
scheme to see just how much discretion the trustees have).  For
example,  it's possible that instead of a lump sum, your client's wife
might receive a "widow's pension".

The paragraph immediately above also highlights that in general,
pensioners whose pension fund has become part of a demutualisation
windfall may not automatically have any direct entitlement to the
proceeds of such windfall.  Such windfall, being payable directly to
the trustees of the scheme, hypothetically could be;

a. used for the benefits of ALL the members of the scheme;
b. used to "prop up" the existing scheme;
c. used to provide extra pensions/benefits to one or a selected number
of members of the scheme or;
d. used in any way that the trustees see fit.

This is one of the main reasons why it's imperative for your client to
see the rules of the existing scheme and, in particular, to see what
latitude the insurance company and/or trustees have with respect to
administering the scheme.

Question 2: Would NOT making a decision (i.e. leaving the fund where
it is) be an option? And why might this not be attractive?

Leaving the fund where it is might be an option.  In this case, it
would simply be held on deposit until your client decides to draw on
it.  Bear in mind that the entire time that the fund remains with the
insurance company, the insurance company is getting the benefit of the
money, not your client.  So, unless there are taxation issues, your
client might want to consider starting to draw from the fund now.

There is always the possibility that the fund could grow in value and
that by not taking his entitlement now, your client's final pension
benefit might, in fact, be worth more at a later stage.  Of course,
there is no guarantee of this.  Additionally, as suggested previously,
if your client does not take any benefits that he is entitled to
during his lifetime, any subsequent death benefits payable might be
entirely at the discretion of the trustees.

I have compiled a short list of some websites which your client may
find useful for further reference:

1. The Department for Work and Pensions has a good, basic reference
site on pensions at:

http://www.pensionguide.gov.uk/

including a selection of factsheets for download from:

http://www.pensionguide.gov.uk/guides/download.htm

2. The Financial Services Authority's ("FSA") consumer pension website
at:

http://www.fsa.gov.uk/consumer/financial_faqs/pensions/mn_pensions.html

In particular, they have a number of pension related guides and
factsheets for download at:

http://www.fsa.gov.uk/consumer/consumer_publications/mn_consumerpubs.html

3. The Pensions Advisory ("OPAS") website found at:

http://www.opas.org.uk/

As listed on their website noted above, OPAS is "an independent
non-profit organisation that provides information and guidance on the
whole spectrum of pensions covering State, company, personal and
stakeholder schemes. We also help any member of the public who has a
problem, complaint or dispute with their occupational or private
pension arrangement."

4. The Plain English Campaign's A to Z dictionary of pension terms -
noted on their website as "designed to give you a fighting chance in
the baffling world of pensions":

http://www.plainenglish.co.uk/PensionsA-Z.html

and

http://www.plainenglish.co.uk/PensionsA-Z.html#top

5. The FSA's excellent and easy to use pension calculator found at:

http://www.pensioncalculator.org.uk/pages/calculator1.php?Submit=I+accept

Straightforward assumptions and background information relating to the
use of the calculator can be found at:

http://www.pensioncalculator.org.uk/pages/home.php 

This tool is a very good and effective starting point for determining 
how much money you'll need in retirement.  Suggest using it armed with
a strong shot of brandy and/or several glasses of champagne - the
resultant calculations can be quite sobering!

If any part of this answer requires clarification, please do not
hesitate to let me know.  I suppose the main message behind this
answer is that your client really needs to ensure a) that he has the
full rules applicable to his pension scheme sent to his attention and
b) that he takes full and proper professional advice from a qualified
independent financial adviser before making any decisions with respect
to his pension.

With kind regards
jem-ga :)

p.s. no bagpipes were consulted during the course of this research ;)

Search/Research Strategy:

1. Google Keywords: pension advice UK

://www.google.com/search?hl=en&ie=utf-8&oe=utf-8&q=pension+advice+UK

2. Personal conversation held with UK-based independent financial
advisor (NBJ Benefits Consultants Ltd.).

3. Telecon with FSA Consumer Helpline representative: Telephone 0845
606 1234

The FSA Consumer Helpline is open between 8 am and 8 pm Monday to
Friday - out of hours the automated service is available 24 hours a
day seven days a week.

4. Telecon with OPAS Consumer Helpline representative: Telephone 0845
601 2923

The OPAS Consumer Helpline is open from 8.30am to 6.30pm Monday to
Friday.  They do not operate an out of hours automated service.

Hi, Jem

You just get better and better.

It was EXACTLY what I wanted and I hate to think what's going to
happen in GaGaLand when you, too, pop off.

(It happens to most of us but, being a very Godly person, I shall
certainly prove to be an exception.)

Very many thanks!

Bryan

Hi Bryan :)

Sorry to hear of your friend Peter's illness - I trust he has
recovered and is prepared to be trounced in dominoes?  I find a good
game of Canasta helps to build stamina ;)

Whilst you are so patiently and kindly awaiting your answer on this
question, I thought I'd provide you with a few fun links and tidbits
to keep you amused and entertained.

1. AskOxford's Aug/Sept. 2003 Quick Crossword (with printer-friendly
version):

http://www.askoxford.com/wordgames/crosswords/crosswordarchive/qu_aug03.ccj/

2. A sampling of AskOxford's "Sound Bites" for the period April - June
2003:

"I'm sorry, we don't do God." - Alastair Campbell, British Press
Secretary to the Prime Minister, when Tony Blair was asked about his
Christian faith in an interview for Vanity Fair magazine.

"Sorry, I don't do offal." - Jamie Oliver, British chef, when invited
by MPs to help improve the food from the Parliamentary Kitchens

http://www.askoxford.com/worldofwords/quotations/soundbites/

3. Wasn't particularly impressed with Merriam-Webster's Word for the
Day for today but their offering for August 19 is good, robust one:

http://www.m-w.com/cgi-bin/mwwodarch.pl?Aug.19

4. Am currently re-discovering Agatha Christie after watching several
BBC productions of The Miss Marple Mysteries starring Joan Hickson. 
Excerpt from the original short story "The Tuesday Night Club" by
Agatha Christie:

"I know, dear," said Miss Marple, "that your books are very clever.
But do you think that people are really so unpleasant as you make them
out to be?"

"My dear Aunt," said Raymond gently, "keep your beliefs. Heaven forbid
that I should in any way shatter them."

"I mean," said Miss Marple, puckering her brow a little as she counted
the stitches in her knitting, "that so many people seem to me not to
be either bad or good, but simply, you know, very silly."

http://www.agathachristie.com/tuesday/bsp/intro2.shtml

5. This site gets points for sheer obscurity - yep, you guessed it -
Fermat's Last Theorem Poetry Challenge found at:

http://raphael.math.uic.edu/~jeremy/poetry.htm

My particular favourite from this site, a la Edgar Allan Poe:

Once upon a midnight dreary, 
As I pondered weak and weary, 
O'er many a quaint and etale sort of cohomology, 
While inducing representations, 
I was led to deformations, 
And the ramifications of modular forms in characteristic p. 
So I struggled to break free. 

Ah, discreetly I conjectured, 
to myself alone I lectured, 
As the virile bust of Fermat wrought its ghost upon my floor, 
Suddenly there came an insight, 
that these flat group schemes were finite 
And I represented functors never dreamed about before. 
Then my soul began to soar. 

"Taniyama!" I then shouted, 
As the logic from me spouted, 
"It all comes down to looking at the prime l equals 3!" 
Modularity is the conclusion, 
And the Frey curve an illusion, 
So Fermat's equation cannot have nontrivial roots in Z! 
Quoth the raven, "Q.E.D". 

- Author: Matt Baker as quoted at
http://raphael.math.uic.edu/~jeremy/poetry.htm

Kindest regards
jem-ga :)

Hi, Jem

You've cheered me up.

Many thanks ... I needed it.

You see, Peter gave his coldy thing to Nell (his partner) and then
somebody gave it to me.

There are now too many suspects for me to pin it down. (Even Poirot
would be puzzling over this, never mind Miss Maple Syrup.)

Me? I've been in bed most of the day and I'm still feeling rough.

BTW I hope you noticed that 'Latics won on Saturday & that Lancashire
are not only the 1-Day Champions in Div 2 but also Runners Up in the
County League Div 1.

Not bad, uh?

Hi Bryan :)

I AM sorry to hear that you've been unwell :( and hope that you are
now feeling a bit better.

Yes, I did notice 'Latics won on Saturday & that Lancashire are not
only the 1-Day Champions in Div 2 but also Runners Up in the County
League Div 1.
 
Perhaps the cold is some sort of retribution? <evil grin>.  A tool to
even the odds...?:

http://www.instantvoodoo.com/default.asp?flash=true&

I must apologise again for the delay in supplying your answer and
thank you for hanging on and being patient.  This one really is
testing all of my resources but I WILL get you an answer :)

Kindest regards
jem-ga :)

Hi, Again, Jem

Great to hear from you ....

And I am delighted to know that, finally, I have managed to test ALL
your resources (allegedly).

However, I've now forgotten what the question was.

Was it something to do with bagpipes?

Kindest regards

Bryan

Hi Bryan :)

Delighted to have been able to assist and many thanks for the great
rating and generous tip!

Speaking of popping, it's a friend's hen night tomorrow and I'll be
joining her for drinks - she's suggested rum cocktails however I've
managed to persuade her that champagne really is the right way to get
things started ;)

Kind regards
jem-ga :)

Hmmmmmmm

I'm not sure about the champagne ....

Why not get a real pain ........?

I'm VERY invite-able.