My wife is looking at changing jobs. She asked if she could move her pension from her employer to either a new employer's plan or to some sort of independent plan.
A simple answer as to if this is even possible would be a great start. There is no obvious place that she wants to move the pension to at this time. It was more of a question on a list of things to do if she is to leave her present firm.
John
Simple answer is yes. She can take the benefits and move them to a Personal Pension plan, SIPP, or a new employer's pension scheme.
However, whether it is in her best interests to do so is another question. You don't state what type of scheme she is in (i.e. Final Salary, Group Personal Pension, etc)....questions you need to ask are whether there are penalties for transfering, is the fund invested in With-Profits, is she benefiting from low charges, just to highlight a couple....
Neil.
Financial Calculators & Tools.
Neil,
Thanks for the quick response. My wife and I are only now starting the conversation.
I have noted the questions you raised. Is there a set of standard questions that would largely cover the topic so I can have her check into the details. No idea what the decision will be. Making sure we at least ask the questions before trying to make an informed decision is the objective at this point.
John
Not as such. Depending upon the type of scheme this is, it will raise a different set of questions.
If her pension is valuable, you may want to employ a Financial Advisor to make sense of it.
Main points (of the top of my head) are:
What charges are applied on her funds (i.e. Annual Management Charge - also check if there are monthly policy fees, transfer penalties, etc). Then when you find out what these are, you need to consider if these can be bettered elsewhere, or whether it is best to leave this with the employer in paid-up form.
Is the fund invested wholly or partly in a With-Profits Fund. If so, is there any penalties (MVA's) on transfer, or have are there any significant bonuses attached which would be lost if transferred.
Finally, what sort of funds are available within the current scheme. If restrictive, would it be more better to move to a new plan with a wider investment range ?
These cover the important points, but there are often quirks to many schemes which are exceptions rather than the rule.
Rgds Neil.
Neil,
A great start. It will provide a framework for a conversation with her HR department. I am pretty sure we are not talking about a final salary scheme. Her plan is somehow part of the executive pension plan so there could be some of the other points you raise.
Once we have a grasp of the present plan details I can raise new questions or otherwise seek further advice.
As to seeking the advice of a professional. What do you do that causes you to be up to speed on the topic?
John
You should check to see if there are any guaranteed annuity rates. Obtain a copy of the scheme rules and read them.
You need to visit a financial adviser who is qualified to deal with pension transfers. Not all of them are.
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