Steve Webb: Find out how to ask the former Pensions Minister a question about your retirement savings in the box below
Today, our pensions columnist Steve Webb answers his 100th question from a This is Money reader, this time helping someone track down an old fund from an employer that went bust.
Unfortunately Steve can’t reply to everyone who writes in, but we hope the broad range of topics he covers helps everyone at some point, whether they get a personal answer or not.
If you want to check out all his previous columns to see if any involve issues affecting you, we have compiled a full list here.
We will now be updating that page whenever Steve publishes a new column, so it’s worth bookmarking it and coming back to make sure you never miss one.
To mark his 100th column anniversary, Steve also reveals what it is like to be This is Money’s pension guru here.
Find out his top five most read columns to date, and how he picks which questions to tackle each week out of the many thousands he has received so far.
A few years ago I worked as a care home manager. Our home was taken over by a large care company that went into liquidation.
Can you tell me what will have happened to my pension from both companies?
I am now retired due to illness at the moment but unable to claim sick pay or Jobseeker’s Allowance as they say I am fit to work but my GP says I am not.
I was wondering how to trace my pension and cash it in. I tried before, however I was told as the company had gone into liquidation it would be held by the Government. Can you advise please.
SCROLL DOWN TO FIND OUT HOW TO ASK YOUR PENSION QUESTION
Steve Webb replies: Whether or not you can access your pension and how to track it down depends on what sort you had.
The first main type of pension is commonly known as a ‘final salary’ or salary-related pension. In this sort of arrangement, the amount you get depends on how much you earned and your length of service.
The pension is normally available at a set age (such as 60 or 65) but many schemes have an option to take a reduced pension at an earlier date. Some will also have rules allowing people to take a pension early on the grounds of ill health.
Care home firm went bust: How do you track down a pension when your old employer has gone out of business
If the firm that was responsible for the pension scheme went into liquidation, and assuming that the pension scheme didn’t have enough money to meet all of its obligations, it gets taken over by the Pension Protection Fund (PPF).
This is often described as a ‘lifeboat’ scheme, which helps to make sure that even if the firm has gone bust, you will still get most of your pension. You can read more about the PPF here.
If you know the name of your former employer and the scheme you were a member of, the PPF would be able to tell you whether you are covered. If so, you will get a regular pension from the PPF at scheme pension age, but you would not be able to take all of the money out.
The PPF gives information about retiring early here and you can call for more information on 0345 600 2541.
STEVE WEBB ANSWERS YOUR PENSION QUESTIONS
However, if your scheme was covered by the PPF I would have expected you to have been contacted by now, assuming that they had up-to-date contact details for you.
The other main type of pension is what I call a ‘pot of money’ pension, also known as a ‘defined contribution’ pension.
This is simply a pot into which your contributions and those of your former employer will have been paid over the years.
That money will have been invested and will be held for you either by an occupational pension scheme or by an insurance company.
Over the years you should have had annual statements showing the value of your ‘pension pot’. If you can find any of these statements this should give you contact details of the pension provider.
The good news is that if you have this sort of pension arrangement, the fact that the employer has gone bust should not affect your pension at all.
The pension pot is held separately from the employer, either as a trust or by an insurance company. Provided that you are aged 55 or over, you should be able to access some or all of your pension pot, though obviously if you spend money now you won’t have it for later life.
You can find out more about your options via the Government’s Pension Wise service here. If you are aged 50 or over, you can also make a free appointment with a Pension Wise staff member, with whom you can discuss your situation in person.
You would also need to think about the tax implications of taking money out of your pension, especially if you do so in a large chunk.
Finally, if you are having trouble tracking down old pensions and don’t have any paperwork, you can try the Government’s Pension Tracing Service here.
If you tell the Pension Tracing Service the name and details of your former employers, they should be able to supply you with contact details for the pension schemes associated with them. You then have to contact them directly to find out where you stand.
Note that this service is provided by the Government and is free of charge – there are other services that you can find on the internet which may try to charge you, but you do not need to pay for the official service.
ASK STEVE WEBB A PENSION QUESTION
Former Pensions Minister Steve Webb is This Is Money’s Agony Uncle.
He is ready to answer your questions, whether you are still saving, in the process of stopping work, or juggling your finances in retirement.
Since leaving the Department of Work and Pensions after the May 2015 election, Steve has joined pension firm Royal London as director of policy.
If you would like to ask Steve a question about pensions, please email him at email@example.com.
Steve will do his best to reply to your message in a forthcoming column, but he won’t be able to answer everyone or correspond privately with readers. Nothing in his replies constitutes regulated financial advice. Published questions are sometimes edited for brevity or other reasons.
Please include a daytime contact number with your message – this will be kept confidential and not used for marketing purposes.
If Steve is unable to answer your question, you can also contact The Pensions Advisory Service, a Government-backed organisation which gives free help to the public. TPAS can be found here and its number is 0800 011 3797.
Steve receives many questions about state pension forecasts and COPE – the Contracted Out Pension Equivalent. If you are writing to Steve on this topic, he responds to a typical reader question here. It includes links to Steve’s several earlier columns about state pension forecasts and contracting out, which might be helpful.
If you have a question about state pension top-ups, Steve has written a guide which you can find here.