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Understanding your OneFamily pension or annuity

Over the years, OneFamily has taken over the running of some contracts that were originally arranged with other companies, including pensions and pension annuities.

If you, or a family member, has a pension or annuity that is managed by OneFamily, the below information should answer your questions.

If it doesn't, give us a call on 0800 298 3542*. Our dedicated pension team would be happy to help.

Please note, however, that OneFamily doesn't provide financial advice. If you need advice, you may find the Pension Wise service, offered by the government, useful.

Or you may prefer to speak to an independent financial adviser. If you don't have one, there are links on the Moneyhelper website to help you find an adviser who can help you. You are likely to be charged for their services.

*We’re here Monday to Friday 9am – 5pm, UK time. Calls may be recorded and monitored for training purposes.

Please note: OneFamily no longer sells pensions or annuities, the below information is for customers who have a pension/annuity that we still manage.

What is a pension?

A pension scheme is simply a type of savings plan to help you save money for later life.

Pensions come with some tax advantages that you might not get with other types of savings, but there also more rules to taking your money out.

When it comes to taking your benefits there are a number of options, which you can see in the 'Accessing your money' section below.

Do I need to pay tax on my pension?

Generally, the money you pay into any pension is tax free.

The growth on your pension investments is also tax free, but you are likely to pay some tax when you come to take your benefits (dependent on your circumstances).

It's a good idea to take professional advice when you're deciding when to start taking your pension benefits, as the timing can affect how much tax you pay, particularly if you have built up a big pension pot.

There is more information on personal tax on the government website. The government's Pension Wise service is also a good place to start if you are looking for some free pension guidance.

What is a pension annuity?

A pension annuity is a type of insurance contract that converts your savings into an annual pension. You then receive an income from the annuity, either for a set period or, in some cases, for life.

As you approached retirement age, you may have chosen to buy an annuity with the pension fund you built while you were working. You could have done this by paying one lump sum or by making a series of payments into the annuity.

Your money will be invested and the regular income you receive from it will either be a set amount (fixed) or change as the performance of the annuity's investments changes (variable) - depending on what was agreed when you bought the annuity.

Do I need to pay tax on my pension annuity?

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Planning for your pension

To help you understand a bit more about what options you have and what you should be thinking about, we have created some example situations to show how different people and goals need different approaches.

Richard, 60, decided against Lifestyle switching options

Richard enjoys his job and is in good health. His original chosen pension age was 62, but he now doesn't want to access his pension savings before age 70.

Richard's pension pot with OneFamily is just one of several pension plans he has. He's comfortable with continuing with his current higher risk investments, as he has other pensions and a good amount of savings. This will let him pick the best time to start claiming his benefits.

Richard considered transferring to another provider to take advantage of Lifestyle switching options, but decided against it.

A Lifestyle switch option would gradually move the invested money from the higher risk funds to lower risk ones over the five years leading up to his chosen pension date. From that point, his pension savings would stay invested in the lower risk fund until he accesses them.

Investing in a lower risk fund with lower growth potential would mean that whilst his fund values would be more stable, the buying power of his pension savings could go down due to inflation, impacting the value of future income.

Jenny, 56, wants to access her pension earlier

Jenny is 56 and had planned to work until her chosen pension date of 60.

However, her daughter has just announced she is expecting twins, so Jenny is rethinking her retirement plans and planning to cash in her pension in a year so she can help with childcare when her daughter goes back to work.

When her children were young, Jenny worked part time and has several pension pots from different employers. She's decided to cash in her OneFamily pension plan only, leaving the others to accumulate for later.

She's reviewed her investment choices and decided to switch her One Family pension savings into a lower risk fund to reduce the risk of her investments losing value right before she cashes in her pension plan.

She understands that by investing in a lower risk fund, inflation may reduce the buying power of her pension savings and she may miss out on any potential growth if financial markets produce strong returns.

Naz, 54, moves part of her pension to a lower risk fund

Naz has worked for several companies during her career. She has a good company pension from one employer which will provide a reasonable level of income. She is approaching 55 and plans to transfer her OneFamily pension plan to another provider in order to access flexible retirement income.

She is planning to take maximum tax-free cash and then draw down taxable lump sums, as and when she needs, to pay for extras such as a holiday or new kitchen.

She is comfortable investing in medium risk funds and accepts that she could lose money if the value of the fund drops.

Before discussing her options with the Government's Pensionwise service, Naz was considering if she should use lifestyle switching but has decided not to. This is because, after taking tax-free cash, the balance of her pension savings are likely to remain invested for many years as she will only access her pension savings from time to time to top up her income. She does not want to miss out on potential growth if the stock market produces strong returns. By investing in a lower risk fund with lower growth potential, she is worried that the buying power of her pension savings may be reduced by inflation, impacting her future income.

She has reviewed her investment choices and will move part of her pension savings into a lower risk fund a year in advance of whenever she plans to access them.

Reginald, 59, uses Lifestyle switching options to reduce risk

Reg is just over five years away from his chosen pension date of age 65. He was late starting to save for a pension and has the majority of his pension savings with OneFamily.

Having looked at how the value of his pension pot has gone up and down over the last few years, Reg feels it's time to remove some of the risk from his pension savings, so he wants to make use of Lifestyle options. When he gets to retirement age, Reg is planning to access his pension savings to buy a guaranteed income for life.

Reg wants the security of knowing that his pension savings won't fluctuate as much as his chosen pension date approaches. So, he has decided to transfer his pension pot to a provider that can offer Lifestyle and annuity options. He understands that he might miss out on potential growth if the stock market is strong and that, by investing in a lower risk fund, inflation may reduce the buying power of his pension savings.

Christine, 49, is happy with OneFamily but may switch providers closer to retirement

Christine is happy with OneFamily's service, charges and fund choice at the moment, but she's planning to review her fund options in the last 5 years before her chosen retirement date.

If Onefamily doesn't offer a fund she is happy with at that time, she's planning to transfer her pension pot to another provider, possibly bringing together a few other small pots she has elsewhere.

Christine is planning to transfer to another provider nearer her retirement date to give her access to a broader range of options like drawdown facilities, as OneFamily doesn't offer that option.

Christine is not yet sure how she will take benefits when the time comes but she's happy that there's no charge for moving her funds from OneFamily to another provider.

These examples are not based on actual customers and should not be taken as advice or the most appropriate course of action in similar situations. They are intended to simply show the importance of being aware of all the pension provisions you've built up through different pension providers and employers over the years, and making a plan around what you think you'll need and when. It may mean that you need to make some changes.

OneFamily pension FAQs

Click the questions below to find out more about your pension.

Most asked

How much is my pension worth?

You can find the value of your pension on your most recent statement.

If you don't have a recent statement, you can give us a call on 0800 298 3542 to request a replacement and make sure we have the right postal address to send future statements to.

We're here Monday to Friday 9am – 5pm, UK time. Calls may be recorded and monitored for training purposes.

Your statement is issued with notes to help your understand your current pension value and what this will mean for you when you retire.

What does 'lifestyling' mean?

Lifestyling is a feature that comes with some pension contracts which aims to gradually reduce investment risk as you get closer to retirement.

If your pension contract has lifestyling, the way the pension fund is invested will automatically change over time. The investment mix moves from a focus on stocks and shares to more fixed interest investments as you get closer to your chosen retirement age.

As this gradually reduces the investment risk, you get more certainty as you near retirement.

The downside is that, as risk reduces, the potential for return also goes down, so this option may not be right for everyone.

Lifestyling is not an option offered by OneFamily, so if you wanted introduce it to your pension product, you would need to transfer your existing pension pot to a provider that offers this feature. Please see the 'Can I transfer my pension to another provider?' section for more information.

How do I let OneFamily know I have Power of Attorney set up?

Risk

What are the risks with investing?

When we talk about risk in investing, it’s the risk that you won’t be able to buy as much with your money when you decide to withdraw it compared to when you first invested it.

This could be because the cost of living has grown by more than your investments, or because falls in the stock market have left you with less money than you started with.

You can find out more about investment risk in our interview with a fund manager.

What are the risks associated with pensions?

For most pensions, your money is invested largely in stocks and shares. Therefore, the pension pot's value can go down, as well as up, as the stock market changes. As a result, it is possible to get back less than you've paid in, particularly in the early years of the policy.

Other risks to be aware of are:

Cost of living increases
As the cost of living rises, the real value of investment growth reduces. That’s because buying goods and services will cost more in 10 years’ time than they do now, so if your pension pot grows, the amount it grows by might not be worth as much as it would be today.
Changes in circumstances
Your circumstances may change, which could mean your policy doesn't provide enough money for you to retire when you originally planned.

If you're worried that the value of your savings could go down as you get close to the time you're planning to take your money, it's usually possible to switch your investment into a fund that invests in fixed interest assets, which are more stable. Usually this will mean your pension produces lower returns over the longer term.

Why would someone choose to move some or all of their pension money into a cash fund?

Generally, a cash fund is used when you want to be certain how much return you'll get or if you're nervous about the value of the fund you're invested in falling.

For example, if you’ve been investing your pension but know you’ll need it in the next few years, you might decide to move it into a cash fund so you know how much you’ll get when it’s time to take your benefits.

But moving to a cash fund means you’re likely to see lower investment returns over the long term than in funds that hold stocks and shares, although this isn’t guaranteed. The value will not go up and down in the same way either.

It’s also worth considering the impact of inflation on the value of your money. If the rate of inflation is higher than the interest rate you’re getting, the value of your money (its buying power) drops.

You can find out more in our guide to saving vs investing.

Fees and charges

How can I find out about my pension's fees and charges?

We charge an Annual Management Charge (AMC) to cover the costs of operating your policy.

The AMC includes most of the investment services of the fund managers we employ, but you may also be charged some additional transaction costs.

Details of your AMC and any other transaction costs are included in your statement each year.

If you don't have a recent statement, you can give us a call on 0800 298 3542 to request a replacement and make sure we have the right postal address to send future statements to.

We're here Monday to Friday 9am – 5pm, UK time. Calls may be recorded and monitored for training purposes.

What happens if I've stopped paying into my pension?

Accessing your money

What are my options after I turn 55?

From age 55 you can access as much of your pensions savings as you want (please note that there may be some tax to pay).

Before a legislation change in 2015, there were fewer options as to what you could do with your pension savings at 55 so the below options might differ to your original product literature. The 2015 legislation change means benefits can now be better tailored to people’s individual needs.

Your options are:

Take a lump sum payment

You can take money directly from your pension pot without having to buy an annuity or put the money into drawdown, and 25% of this sum will be tax-free. This is called an ‘uncrystallised funds pension lump sum’ (UFPLS). You can take one or more UFPLS payments, which can be regular or irregular payments.

Lifetime annuity

You can use some or all of your funds to buy an annuity which will be payable for at least the rest of your life. You can take a tax-free lump sum of up to 25% of your pension pot when you buy an annuity. This is called a 'pension commencement lump sum'.

Flexi-access drawdown

You can put funds into drawdown. As of 6 April 2015, there are no limits on how much or how little you can take from your drawdown fund each year. You can take a tax-free 'pension commencement lump sum' (see above) of up to 25% of your pension pot when you put funds into drawdown. Any drawdown payments are taxed as income.

Please note that OneFamily doesn't offer new annuity contracts or drawdown facilities. If these are facilities you need or want, please get in touch and we will help you with the process of transferring (at no cost) your existing pension pot to a provider that does provide these services.

How can I get help managing my pension?

If your pension is managed by OneFamily, give us a call us on 0800 298 3542* to make sure we have the correct contact details for you and to manage your pension over the phone.

We will need to go through a security check with you.

You can also email us at [email protected], but please be aware we won't be able to discuss personal or financial details over email. This is to keep your account safe.

Or, you can write to us at:

OneFamily
16-17 West Street
Brighton
BN1 2RL

We also offer additional support for customers who have difficulty managing their products themselves, find out more in our Supporting You section.

*We're here Monday to Friday 9am – 5pm, UK time. Calls may be recorded and monitored for training purposes.

Death benefit

How can I make sure the right person receives the death benefit?

The pension holder has passed away, how can I let you know?

How would my family keep track of my finances if I died?

Your pension contract was arranged for the purpose of saving for your retirement, but it does include a death benefit, which pays out if you die before you retire.

It's therefore important that let whoever will be handling your financial affairs know about your pension, as well as any other financial products you have.

Our everything in one place form is a free resource to help you do this. It is for you to decide, how, when and if you share it.

Pension funds

What fund is my pension invested in?

How is my pension fund performing?

Can I switch funds?

If you feel that your current fund is no longer right for you, it's possible to switch to one of the other EdenTree funds without cost. Take a look at our Fund Factsheets to find out about the difference funds (the five Edentree funds are at the bottom of the table).

If you decide to go ahead, please call us on 0800 298 3542 to arrange the fund switch.

We're here Monday to Friday 9am – 5pm, UK time. Calls may be recorded and monitored for training purposes.

Can I transfer my pension to another provider?

We don't charge you to transfer your pension to another provider.

This could be a good option if you want to change the way your money is invested to a type of fund OneFamily doesn’t provide, access a benefit option we don't have or simply pull all your pensions in one place.

Once you've chosen the pension scheme you'd like to transfer to, you'll need to complete the company's transfer request form. They will then get in touch with us and between us we'll arrange the transfer. You'll then receive a confirmation from your new provider when the process is complete.

If you are thinking through your options, we strongly encourage you to take the time to have a free consultation with the Government’s Pensionwise service, who can help you understand your options and arrive at a plan.

Understanding your OneFamily pension or annuity

What is a pension?

What is a pension annuity?

Looking for a different OneFamily product?

Planning for your pension

OneFamily pension FAQs

Most asked

Risk

Fees and charges

Accessing your money

Take a lump sum payment

Lifetime annuity

Flexi-access drawdown

Death benefit

Pension funds

Governance Advisory Arrangement

OneFamily's Legacy products

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