Contracting out may invalidate enhanced protection - Abbey

According to AfI's head of pensions and retirement Mike Brown, an anomaly has been detected in the latest update of pending pension legislation coming into effect in April 2006. This anomaly could see people, who decided to protect their pension funds by adopting enhanced protection, ending up with no protection at all if they have already contracted out of the State Second pension, says Brown. Enhanced protection will under the new legislation protect people who are worried their pension pots will exceed the £1.4m lifetime limit. While it will protect the whole fund from having to pa...