Case Study: Defined Benefit Pension review

Background

Mr White (60 yrs.) approached Fiducia to conduct a review on his pension arrangements since he was not in the best of health and was considering taking early retirement. He had one small personal pension and one final salary pension. Mr White had very little knowledge on his retirement options and wanted some help to understand how his retirement was going to look. He was not married and had no financial dependents.

Problem

Mr White’s final salary pension provider had written to him and outlined some options, on the basis he would take immediate (early) retirement. If he wished to start taking benefits, the scheme only offered him two options: the first was a higher annual income figure with a smaller lump sum and the second was a higher lump sum with a smaller annual income. Mr White knew that he wanted at least £15,000 of index-linked (inflati