moved to Pensions - Practical as requested by OP (chas49)
My wife is 60 years & 3 months old and has accumulated several pensions of various sizes. Five of them are Defined Contribution (DC) pensions ranging in current value from £50,000 to £200. None are in payment. She also has two small Defined Benefit pensions (DB) to which she stopped making contributions over 30 years ago and are currently deferred.
The trustees of one the DB Superannuation Schemes has just written to her to say they intend to make an offer to exchange her Deferred Benefits for a one-off cash lump sum.
Her current accrued deferred benefits in this DB scheme are approximately :-
Pension: £896 pa and a Lump Sum: £1791 (increased according to CPI capped at 5% per year)
My question is –
Is this approach from the DB scheme trustees offering a cash lump sum quite normal for people with small a deferred pension and is it generally a poor option ?
Would a deferred pensioner normally be offered a larger sum by asking the DB Scheme for a 'Transfer Sum' quote with a view to transferring the deferred Benefits into a new SIPP or a DC pension ?
Alternatively she could just take a the pension (Lump sum + Pension) when it becomes available at 65 from her two DB Superannuation schemes ?
Would it be better to transfer her five DC pensions and two DB deferred pensions into a SIPP or into her largest DC Pension Scheme or another scheme such as PensionBee ?
My wife has a full National insurance record for a full state pension in six years time. She is currently doing part-time self-employed admin work earning about £9000 pa. She is no longer contributing to any pension scheme. She plans to carry on working part-time until State pension age.
Any comments would be appreciated.