# Should I surrender my pension now?



## Crea (23 Jul 2008)

I left employment 2 years ago. At that time I had been part of the companies pension scheme for 6 years. 
In March I contacted Canada Life about surrendering my pension and I got the following statement:

Employer contributions paid: €8830
Surrender value: €7066

Employee contributions: €20822
Surrender value: €16489

Am I entitled to the total surrender value of €23776 or do I minus 40%?
Will the value of this have reduced given the current economic climate?
We are currently paying alot of interest on credit cards and this money would essentially clear this and allow us to save and/or put additional money into my husbands pension so is it worth cashing it in or not?


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## shaking (23 Jul 2008)

Did you retire or just leave the company? You can't access your pension until retirement age


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## HighFlier (23 Jul 2008)

AFAIK you can access the employee contributions by paying the relevant tax. You cannot access the employer contributions.

You can transfer the entire amount into an approved fund without any current tax liability.


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## shaking (23 Jul 2008)

you can only access the employee contributions if you were in the pension plan for less than 2 years. As op was in the plan for 6 years they have no entitlement to take a refund of employee contributions


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## Crea (23 Jul 2008)

When i emailed the company they gave me a Leaving Service options form. Given that they gave me surrender values I assumed that I could surrender it. So they can hold onto my money for the next 17 years eventhough I need the money now????


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## boaber (23 Jul 2008)

Crea said:


> When i emailed the company they gave me a Leaving Service options form. Given that they gave me surrender values I assumed that I could surrender it.



You say you got a leaving service options form - are the options available to you not set out in this? Given that you have more than 2 years service your options would be to 1) transfer to a Buy Out Bond / another Occupational Pension Scheme or 2) leave the benefits in your old employers scheme until you reach retirement age.



> So they can hold onto my money for the next 17 years even though I need the money now????



That's what the legislation states, it's not a Canada Life rule.  _Technically_ it's not your money (yet).  It's held under Trust for you by the Trustees of the scheme.  On the options form there should be a place for the trustees to sign, i.e. they will be discharging their liability to your fund once it is transferred our.  Plus it is a *pension* scheme and not a savings scheme, the whole idea of a pension scheme is that you are saving to replace income in retirement.


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## ClubMan (23 Jul 2008)

Crea said:


> When i emailed the company they gave me a Leaving Service options form. Given that they gave me surrender values I assumed that I could surrender it.


No. You have more than 2 years membership so, as mentioned above, cannot release any of the funds (even your own contributions) prematurely. The surrender value also refers to the value which you can transfer elsewhere - e.g. to another occupational scheme or to a buy out/pension retirement bond. Or you can leave the money invested in the former employer's occupational scheme for now. 





> So they can hold onto my money for the next 17 years eventhough I need the money now????


See your options above. "They" don't get any benefit from your funds at all. Ultimately your money is locked away until retirement so if you need money now you'll need to look elsewhere.


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## Crea (24 Jul 2008)

Bummer!
Thanks for the info everyone - not what I wanted to hear but at least I know.


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