Questions of cash: What's happened to my pension fund?

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Q. I worked for Courtaulds between 1963 and 1969, and according to my P60s paid into a pension fund. I cannot remember whether I received back my contributions when I left. I will soon be 60 and would like to know if there is anything due to me.
EH, by e-mail

A. You should ask the Pension Scheme Registry to try to trace what happened to your pension scheme. Contact them online at www.opra.gov.uk or telephone 0191 225 6316.

Q. I am 42 and disabled. Since 1997 my National Insurance contributions have been credited for life. My pension forecast for 2027 is a basic state pension of £79.60 and additional state pension of £3.82, at today's rates. I contracted-out of Serps in 1995. But I have been told it may now be favourable for me to contract back in.
KD, by e-mail

A. Carl Melvin, a pensions adviser at Pension Transfer Solutions, says: "As a disabled person unlikely to work again, your main concern should be security of income in retirement. It is very important that risk to state pension retirement income is minimised. If you remain contracted-out of the State Second Pension scheme (S2P) you face two risks.

The investment risk is that the pension fund may not perform as well as hoped, resulting in a lower income at retirement. The annuity risk is that the cost of buying an income with the accrued pension fund may be higher than expected, providing you with less income.

If these risks materialise, contracting-out would be an expensive mistake. The level of rebates paid for contracting-out have been progressively reduced, and S2P structured to benefit lower earners, suggesting that you should contract back in. You should be aware, though, of the risk that the state pension age may increase from 65 to 70 at some point.

Q. My mother is 89 and has difficulty walking. She paid a £1,000 deposit to have a lift fitted by Brook Stair Lifts. But before the lift could be fitted she had to go into residential care. Now we can't get the deposit back.
MM, Bishop's Stortford

A. Acorn Stair Lifts, which owns Brook, says it has written several times asking for details of how to repay the deposit, but has received no reply. We have forwarded to you the contact information of the person trying to return the deposit.

Q. I have been sold a mobile phone contract by Phones4U on the 3 network. I needed a tariff giving me the lowest cost for the highest minutes for a short period to enable me to work from home until a landline was installed. I was told I could change my tariff from £100 a month to £15 a month after three months, but now 3 is enforcing a longer term contract. When I cancelled my direct debit, 3 cut off my phone although I had used only 100 of my 2,000 free minutes. 3 says the problem is with Phones4U and I must pay for more than the year's contracted payment to cancel. I get no satisfaction from my letters and calls to both companies.
JE, Southampton

A. Phones4U has agreed to pay off the rest your contract, but 3 will honour the unused free minutes for the entire period of your existing contract. Phones4U apologises for your problems which it says stem from a misunderstanding at the point of sale. Despite many attempts in nearly three months we have found it impossible to obtain a detailed response from 3 regarding your problems, but we understand it is co-operating with the solution provided by Phones4U.

Q. I have paid off my £10,000 mortgage, but I continue to hold the underlying Legal & General endowment. How do I sell it on the market to obtain a higher value than the surrender value?
JT, Chester.

A. You can go to a broker who can obtain quotes on your behalf or yourself go online to the websites of the Traded Endowment Policies Exchange (www.tepexchange.com) or the Association of Policy Market Makers (www.apmm.org) to seek offers.

Q. I will soon retire at age 49. I expect to receive a lump sum of £80,000, plus a net income of £1,000 monthly. I have an endowment mortgage for £60,000 due to finish in 2010, with an expected shortfall of £8,000. I don't know whether to pay off my mortgage and invest the rest.
KS, by email.

A. It would seem sensible to pay off your mortgage before investing. You could surrender your endowment to pay off the bulk of the mortgage, depending on who the policy is with and what market value adjustment will be imposed for surrender. Your choice for the balance of the money should be based on whether you are confident you can live on £1,000 a month. Mark Dampier of Hargreaves Lansdown suggests you keep at least £10,000 in a high-interest savings account to provide easy access to your money. For the balance he recommends using a UK equity high income fund.

* If you have any queries, write to: Questions of Cash, The Independent, 191 Marsh Wall, London E14 9RS, or e-mail: cash@independent.co.uk. Please send copies, not originals.

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