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    • hmmdonuts
    • By hmmdonuts 22nd Sep 16, 4:58 PM
    • 2Posts
    • 1Thanks
    hmmdonuts
    Pension consolidation - Should I?
    • #1
    • 22nd Sep 16, 4:58 PM
    Pension consolidation - Should I? 22nd Sep 16 at 4:58 PM
    HI I have a couple of questions in relation to consolidating pension schemes. I have 4 pension schemes not currently being contributed to, 1 from a former employer contains approx £25k with Aegon (Buyout Policy), and 3 personal pension schemes 2 with Phoenix with £7k and £12k respectively and 1 with ReAssure (was Barclays) with £47k, plus my current employers scheme with L&G with approx £30k.

    Should I seek advise to merge some or all of these schemes into each other or into my current employers scheme, to manage them easier or simply leave them alone until it is time to start drawing on them? The increases to these funds year on year is not huge.

    I have made a tentative approach to a local IFA who have asked me to complete letters of authority to complete (which I understand, as without them they cannot gather the required information), but there is a paragraph one of the letters to be sent to the ReAssure and Phoenix schemes that requests the servicing rights and renewal commissions of the policies to be transferred to them (which I do not), is this normal practice?

    Thanks in advance.
Page 1
    • dunstonh
    • By dunstonh 22nd Sep 16, 5:37 PM
    • 84,105 Posts
    • 49,094 Thanks
    dunstonh
    • #2
    • 22nd Sep 16, 5:37 PM
    • #2
    • 22nd Sep 16, 5:37 PM
    I have made a tentative approach to a local IFA who have asked me to complete letters of authority to complete (which I understand, as without them they cannot gather the required information), but there is a paragraph one of the letters to be sent to the ReAssure and Phoenix schemes that requests the servicing rights and renewal commissions of the policies to be transferred to them (which I do not), is this normal practice?
    It is normal. Full agency permissions are easier than info only. Info only wont integrate with IFA back office software whereas fully agency will. Info only tends to be time limited whereas agency transfer doesnt expire.

    Should I seek advise to merge some or all of these schemes into each other or into my current employers scheme, to manage them easier or simply leave them alone until it is time to start drawing on them? The increases to these funds year on year is not huge.
    If its better to consolidate into a modern plan then yes. If its not then no. Until an analysis is carried it, it is not really possible to say. Although most old plans are better off in modern versions (most does not mean all).
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from a Financial Adviser local to you.
    • Malthusian
    • By Malthusian 23rd Sep 16, 9:56 AM
    • 963 Posts
    • 1,283 Thanks
    Malthusian
    • #3
    • 23rd Sep 16, 9:56 AM
    • #3
    • 23rd Sep 16, 9:56 AM
    I have made a tentative approach to a local IFA who have asked me to complete letters of authority to complete (which I understand, as without them they cannot gather the required information), but there is a paragraph one of the letters to be sent to the ReAssure and Phoenix schemes that requests the servicing rights and renewal commissions of the policies to be transferred to them (which I do not), is this normal practice?
    Originally posted by hmmdonuts
    As Dunstonh says, all this means from your perspective is that the IFA will have authority to obtain information from ReAssure / Phoenix. Letters saying they can release information but not transfer servicing rights can be problematic because the provider frequently loses them at the back of the file or unilaterally expires them after a year or six months.

    Transfer of renewal commission means that any regular commission Phoenix / ReAssure are currently paying - to whoever advised you on or sold you the plan in the first place - will be paid to your IFA instead. This will not result in a penny extra being charged to you, it is simply a transfer of commission that you are already paying and have been ever since you took it out. And presumably you are no longer in contact with whoever the original salesperson / adviser was. There is every chance that this is a moot point and your plans aren't paying any renewal commission anyway.

    As your plans are old and one of them is a Buyout Plan there is a chance that they have guarantees and benefits which would be lost if you consolidated them. But the IFA will be able to confirm this once they have sent your letters of authority off and the providers have written back.
    • xylophone
    • By xylophone 23rd Sep 16, 10:25 AM
    • 18,452 Posts
    • 10,383 Thanks
    xylophone
    • #4
    • 23rd Sep 16, 10:25 AM
    • #4
    • 23rd Sep 16, 10:25 AM
    Buy Out plan - a S32?

    This could well be a plan with safeguarded benefits - you mention approximately £25,000.

    If it is a S32 and the value of the benefits turns out to be over £30,000,
    then you might require an IFA with Pension Transfer permission?

    http://www.pruadviser.co.uk/content/knowledge/oracle_archive/oracle-technical/oracle-tech-june/fca-transfer-rules/
    • hmmdonuts
    • By hmmdonuts 23rd Sep 16, 11:12 AM
    • 2 Posts
    • 1 Thanks
    hmmdonuts
    • #5
    • 23rd Sep 16, 11:12 AM
    • #5
    • 23rd Sep 16, 11:12 AM
    It is a section 32 policy, the most recent statement summary advises that the value is £28,159.

    Thank you for the comments, I do feel more confident to go ahead seeking financial advise.
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