Pension Fund Transfer - a Brief Guide

You will have heard of the pensions crisis that is looming in the UK and you probably want to ensure yourself that you’ll be secure come retirement time. 

Reasons to Transfer Your Pension Fund

There are many reasons that people choose to decide to transfer their pension.  Most people are unhappy with the service that they’ve received from their pension provider or the performance of the pension fund.  No matter the reason, a Pension Fund Transfer is possible.  A company pension can be transferred to a personal or stakeholder pension, it can often also be transferred directly to your new company’s pension scheme.

Badly Performing Pension Funds

If your Pension Fund has been badly performing it may be time to transfer your Pension Fund to a new company.  Everyone acknowledges that it’s a poor economic period.  However, a consistently poorly performing pension will cost you much more than you realise.  A change to a different pension fund provider can cause significant increases in your final fund.  Making this kind of change requires expert advice, never change without thinking it through carefully.

Company Pensions

If you change jobs, you’ll be keen to transfer your company pension too, to get the most out of your pension fund.  Speak with an expert about the most cost efficient way of doing this transfer.  If you’ve been paying into the pension fund for less than two years, you can apply for a refund and take the cash, but be aware that you may be taxed.

Close to Retirement

If you’re reaching retirement age, you have a choice.  For each one thousand pounds that you’ve invested into the pension fund, you could receive a very different size of annual income.  Each provider offers varying levels of payment.  Making the move to a new provider could massively increase your potential gain.  Making a pension transfer is a highly specialised service within a volatile pension market.  Pension moves should be carefully considered before taking any action and an independent financial advisor should be consulted.

Things to Think About

You should speak to your current pension fund provider and ask about any penalties involved with leaving your current pension scheme.  It’s important to ask your pension provider about the transfer value to find out what you might lose in the deal.  If you are going to lose a great deal, it might be worth considering starting up an additional pension scheme with a new provider.

It’s very important to know that there is no cooling-off period on a pension deal.  If you change your pension provider you can’t back out of the deal.  Closely examine the two different pension products and ensure that you are clear about any potential advantages and disadvantages of the new deal.

You should think carefully before making any decision and if you are unsure, speak to an independent third party.

Most customers can get a better deal than their current pension plan is offering.  However, you should always consult an independent financial advisor.  To discuss Pensions and Pension Fund Transfer with an expert at Hanson Wealth Management, please contact us today.

Hanson Wealth have offices in Boldon, Durham, Inverness, Standish and North Berwick. We have a community of independent financial advisers based throughout Scotland, England, Wales and Northern Ireland as well as a variety of services available over the telephone or via the internet. So even if you are not based near to one of our branches, we can still ensure that you will get quality independent financial advice from our IFA team.

Call today on 0191 495 2254 or freephone 0800 881 8085

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