A pension transfer is the process of transferring or switching the fund you have built up in one pension scheme to another.
You may wish to do this because you are changing jobs, for example, or simply because you are unhappy with the benefits, performance, fees or security of your current pension scheme. If you have several pension schemes, you may also wish to transfer them all into a one personal pension or a self-invested personal pension (SIPP) to make them easier to manage.
But, it is important to make sure you know what you’re giving up before moving to a new pension scheme.
How does it work?
If you would like to transfer your pension, you can either call or email your current pension provider and ask them for a transfer pack. Your provider will send you your current value and transfer value of your pension and the necessary discharge forms you will need to complete in order to transfer your pension from one provider to another. Your transfer value is not guaranteed and can change on a daily basis, depending on what you are invested in.
If your defined benefit or final salary pension, has a cash equivalent transfer value of £30,000 or more, you will be required to get regulated financial advice first. In most cases you are likely to be worst off if you transfer out of a defined benefit scheme, even if your employer gives you an incentive to transfer out.
As a general rule, it is only really worth transferring if the value of the fund is £10,000 or more. You shouldn’t transfer it if your current pension has guarantees, for example guaranteed annuity rates (GARs) or enhanced tax-free cash which will be lost on transfer.
Pension transfers can be a highly complex area as there are many issues, including what type of pension you are considering switching from and whether any transfer charges imposed will outweigh the benefits, to consider before deciding whether a transfer will benefit you. Consequently, it is a good idea to take professional advice before making a pension transfer.
Fill in our enquiry form now to discuss your options with an independent financial adviser who can assess your case by analysing the financial position of your present scheme and the risks of the alternative pension plan, as well the transfer value.
When starting at a new company, you may be presented with the option of joining your new employer’s pension scheme.
There are many different types of company pension schemes, depending on the type of pension scheme and its rules it may be possible to transfer your previous employer’s pension scheme into the new one. This has the advantage of keeping the pensions in one place – however, there may be penalties incurred by transferring your old scheme, which would mean that it would be beneficial to leave it with the old employer. When as cheme does permit a member to transfer an old pension into their scheme, they will sometimes stipulate that the transfer is processed within a set period of time, for example, within one year of joining the scheme.
If a scheme allow transfers into their plan, it is advisable to fully compare the new plan against the old scheme as benefits vary widely between plans. Talk to a financial adviser who will be able to make these comparisons for you and advise you on the effect of any transfer penalties, please complete the enquiry form, and we will arrange for you to be contacted by one of our experts.
Are you thinking about transferring your pension or considering switching your personal pension or company pension.You should ask yourself these questions:
Simply complete our short form and one of our expert Pension Advisers will call you back & arrange a free, no obligation pension review.
You can also request contact details from the Pension Tracing Service by phone or by post.
The Pension Tracing Service
Telephone: 0800 1223 170
From outside the UK: +44 (0) 1782 389134
Monday to Friday, 9:00 am to 5:30 pm
The Pension Tracing Service
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The Pension Tracing Service ® is a trading style of the Millennial Wealth Ltd. We are authorised and regulated by the Financial Conduct Authority. FCA number 914746. Unit 11Flag Business Exchange Peterborough Cambridgeshire PE1 5TX. The registered company number is 11557299
This service is not affiliated with the Department of Work and Pensions or any government body. The Pension Tracing Service does not offer financial advice to our clients. However we can allocate you an Authorised and Regulated Pension Specialist.
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