Transer to SIPP - questions!

shepht · 19 January 2018 at 5:16PM

My husband and I both 58, after talking to our trusted, long term FA my husband transferred one of his DC pensions (£110,000) to an Old Mutual SIPP 5 months ago at the same time I requested a transfer from a smaller (£30,000) Friends' Life (now Aviva) to the same fund Old Mutual SIPP, this has still not happened (nightmare but looks like it is being resolved soon). My questions are can I request 25% tax free from Friends Life (now Aviva) DC pension now and then in a couple of years request a tax free 25% from the Old Mutual SIPP and secondly I am entitled to compensation as I have lost out on the SIPP benefits (my husbands SIPP has made well over £3000 in 5 months)?
We are mortgage free on our £500,000 house, I have £11,000 DB pension at 60, we both have smaller DC pensions at 65, full SP at 66 and we have £30,000 in savings and now save £20,000 a year hoping to retire at 62 on a budget of £26,000 per year, we can both do short term contract work if need be. I am a non tax payer working 2 days a week due to being disabled mother's main carer. We have helped our adult children buy their first homes and they are financially independent.
Any suggestions to being able to hasten our retirement would be gratefully accepted!

dunstonh · 19 January 2018 at 5:35PM

5 months ago at the same time I requested a transfer from a smaller (£30,000) Friends' Life (now Aviva) to the same fund Old Mutual SIPP, this has still not happened (nightmare but looks like it is being resolved soon).

There are some issues with ex FL plans starting with DC. Otherwise, most Aviva (ex FL pensions) transfer within days.

My questions are can I request 25% tax free from Friends Life (now Aviva) DC pension now and then in a couple of years request a tax free 25% from the Old Mutual SIPP

No. You will almost certainly find the FL plan does not support drawdown. Plus, you cant draw two lots of 25% TFC against the same money. Even if it goes on to grow.

and secondly I am entitled to compensation as I have lost out on the SIPP benefits (my husbands SIPP has made well over £3000 in 5 months)?

No. The provider has 6 months to transfer it. Plus, it is still invested where it is and would have seen growth.

Also, are you sure it is a SIPP with Old Mutual? That is an old product and most of their stuff for a long time has gone on their platform which is a personal pension. The charges on their SIPP are higher than the PPP. Its unusual to see someone using their SIPP unless it is for niche/specialist investments.

Any suggestions to being able to hasten our retirement would be gratefully accepted!

Ask your adviser. However, not taking money out of your pension early is one way. Paying more in is the obvious one. They are only as good as what you pay into them.

shepht · 19 January 2018 at 5:57PM

Thank you Dunstonh, I was hoping you would reply! You are right, it is a Collective Retirement Account not a SIPP, are the principles very different? We got a discount as we both (well hopefully I will soon) transfer some money over to Old Mutual.
I stopped paying in to FL 8 month ago and requested transfer papers last June so it is longer than 6 months. Our FA started the Old Mutual transfer in September and we have been passed from pillar to post with FL. I have spent an hour on the phone to Aviva this week, FL's fault apparently.
I am not pension savvy! I am also concerned at friends saying the stock market must crash soon / Brexit will have a negative impact so feel happier building up cash funds, is this naive?

dunstonh · 19 January 2018 at 8:14PM

I stopped paying in to FL 8 month ago and requested transfer papers last June so it is longer than 6 months.

Both Aviva and Old Mutual use the Origo transfer system. Transfer forms are not required. My issue has been getting policy details confirming things like no safeguarded benefits and the figures required to do cost comparisons. Constantly promised they would arrive in 3 days with each chase. And each time told they couldnt see why it wasnt working.

I am quite pleased you are having problems with ex FL plans. I know its not just me now.

I am also concerned at friends saying the stock market must crash soon / Brexit will have a negative impact so feel happier building up cash funds, is this naive?

So far, Brexit has had a positive impact on investments. However, in the scheme of things, it is a minor issue.

There is always a stockmarket crash coming. You dont know the dates but you know its on the way. Could be this week, next month, next year or 2-3-4-5 years away. Last one was just over 2 years ago. Most people didnt even spot it.

It is also important to not mix up crashes, which occur every 2-5 years with significant financial events which tend to average every 7 years. Those significant financial events also tend to be focused in regions historically with global ones being more of a generational thing. The credit crunch and dot.com period were the only two significant global crashes in the last 30 years.

Crashes are normal. They happen and should not be a concern. The media tries to blow it out of proportion and scare people but crashes are actually needed for investments to work properly. If you are paying into investments regularly then crashes are good news.

Cash funds/savings actually can be higher risk for longer term. Whilst investments zig zag in value, the chances of you suffering inflation risk and shortfall risk are lower than cash savings.

The more crashes you go through, the easier it gets. You have been through many without even realising it.

shepht · 20 January 2018 at 10:59AM

Thank you Dunstonh you have reassured me, no one has a crystal ball. We are increasing our payments to Old Mutual. Hopefully retirement is not far away and we can enjoy it!

ProDave · 20 January 2018 at 11:02AM

dunstonh wrote: »

There are some issues with ex FL plans starting with DC. Otherwise, most Aviva (ex FL pensions) transfer within days..

I am in the process of transferring an old FL policy over ti HL

Reading this thread and the story of it taking 6 months has sent shivers down my spine. I want to draw some of it in 6 weeks!!!!!!

I actually have 4 policies originally started with FL now absorbed into Aviva. They all start with "1135......" No letters in the policy numbers. Do you think these will transfer quickly?

Dorian1958 · 20 January 2018 at 1:07PM

You say you have full SP at 66, but have you had obtained an online forecast of what the implications would be if you stopped employment early? What does your forecast actually say? If you were not earning but still caring for mum, depending upon your mum's benefit situation you might qualify for NI Carer's credit. If you are short of a few years due to stopping work early this might negate needing to buy some years to top up.

wjr4 · 20 January 2018 at 1:26PM

ProDave wrote: »

I am in the process of transferring an old FL policy over ti HL

Reading this thread and the story of it taking 6 months has sent shivers down my spine. I want to draw some of it in 6 weeks!!!!!!

I actually have 4 policies originally started with FL now absorbed into Aviva. They all start with "1135......" No letters in the policy numbers. Do you think these will transfer quickly?

It shouldn't be too much of a problem. I've recently transferred a similar plan for a client and it has not taken any longer than it usually would. Call Aviva to check they received the paperwork, if anything is outstanding and get a turnaround time - don't just assume things are processing as they should. If it takes longer than their stated turnaround time say you'll make a complaint and that usually hurries them up!

shepht · 20 January 2018 at 2:06PM

Can't use quote option on my Mac - sorry!

ProDave I left my company 2 months before it went closed down and this seems to have complicated the issue, ex colleagues have successfully claimed or transferred, it is only me with the problems and Aviva has raised an internal complaint.

Dorian1958, yes we have obtained online forecasts, I am still paying NI, confused that my husbands forecast in for £184 a week when I thought the maximum was £159. My mum receives attendance allowance, I hadn't thought about carers allowance, I still work 2 days a week but I am not a tax payer.

Our financial advisor has asked me to get a CETV on my DB pension to see if this will hasten the retirement although reading through this forum I don't think I have the knowledge to handle the investment.

dunstonh · 20 January 2018 at 2:21PM

actually have 4 policies originally started with FL now absorbed into Aviva. They all start with "1135......" No letters in the policy numbers. Do you think these will transfer quickly?

From the little I was told, it was specific to a version of a plan and the migration of it onto Aviva systems. The plan type had a single policy number but multiple segments with their own numbers.

ProDave · 20 January 2018 at 2:41PM

I am moving mine out of Aviva because they have proved themselves singularly useless. You can't even view the value of your ex FL fund on line now (you could up until about the middle of last year)

Drawdown is not an option with Aviva. All they said I could do with it was take the whole lot as cash (and pay the tax on 75% of it) or draw an annuity. I asked them for a prediction expecting to see what annuity terms they would offer, and all I got was a statement of the funds value.

Transer to SIPP - questions!

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