Arranging a pension to make the most of available funds

We were contacted by Mr Cross in Jan 2013. He had been forced to give up work due to a heart condition and wished to discuss his retirement options. He correctly understood that his poor health would have a positive effect on the pension he would receive but wanted to take advice prior to signing any documentation. 

Mr Cross was married and had 2 children from his first marriage. He did not want his eldest son to benefit from his estate.  

We looked at Mr Cross’s whole affairs and quickly realised that he did not need the full amount of tax free cash that he could have taken from the pension fund. We discussed at length with Mr Cross the options available to him and he quickly realised that he was better placed not taking as much tax free cash as he had originally planned.  

Through correspondence with the previous scheme we also worked out that he had been misadvised previously and were awarded a further £56,000. This made a massive difference to Mr Cross; he was not aware of this. 

Mr Cross entered into a Phased Drawdown arrangement where he now frequently takes smaller sum of tax free cash; this had a positive effect on the residual fund that will pass to Mrs Cross and means that there would be a significantly smaller tax charge to be levied on his death. 

Furthermore, as opposed to his original intention of Mrs Cross only receiving 50% of his pension, she is now entitled to take 100% of the pension her husband was in receipt of.  

Even better is that unlike an annuity where the funds would be retained by the life office, the residual fund would now pass on through the generations to come.  

However Mr Cross had a concern that he did not want his son to receive any of the money. For this reason we wrapped the benefits up under a Pilot Trust. 

This trust gave the trustees powers to ensure that the money stayed with those who Mr Cross wished to benefit, that in the event of subsequent divorce of his children or even grandchildren, the assets passed to them by their father/grandfather was secured from the grasp of the ex husband or wife. 

Mr Cross cannot recommend us enough to his friends and associates.