Forced Pension fund transfer

matthew_richard_harman

Hi, I'm new here and after some advice about pensions

My wife stopped work when we had our first child and we don't intend for her to go back to work for a long time if ever. She has accrued approximately £8K in one of her pension funds which we've been told she either needs to transfer to another fund or get a cash payment which will be less that £2K after tax.

I ideally just want to move it to another pension and leave it for 20 years but I'm struggling to find out if there are pension option where you don't actually have to contribute. does anyone know if such products exist? Is transferring the money to a pension fund the only option to preserve the funds full value?

Any pointers greatly appreciated.

Thanks

Debt_Free_Chick

You can transfer this to any personal pension or stakeholder pension without the need to contribute. However, many pension providers will insist that you only do this through an IFA, as the provider will not be responsible for advising you of the best option.

Either do this through an IFA or find a provider who will act on an "execution only" option.

matthew_richard_harman

Debt_Free_Chick wrote: »

You can transfer this to any personal pension or stakeholder pension without the need to contribute. However, many pension providers will insist that you only do this through an IFA, as the provider will not be responsible for advising you of the best option.

Either do this through an IFA or find a provider who will act on an "execution only" option.

Hi thanks for the advice.

I'll talk to a IFA, my main concern is that as we're not paying in, the IFA will get commission every year on a pile of money that isn't going to grow that much in 20 years so will make a dent, but either way it's better than taking the fund out as cash.

Debt_Free_Chick

matthew_richard_harman wrote: »

Hi thanks for the advice.

I'll talk to a IFA, my main concern is that as we're not paying in, the IFA will get commission every year on a pile of money that isn't going to grow that much in 20 years so will make a dent, but either way it's better than taking the fund out as cash.

Commission on a transfer would just be a one-off payment. There would only be further commission if regular payments were made.

The commission will be disclosed to you by the IFA. In fact, the IFA might want a fee as the commission is not as great as you imagine and may not be sufficient to cover the cost of the work he does. Transfers are highly regulated and the IFA will need to do full analysis of what is the best option.

Shop around, though

blackanchorage

I've transferred company pensions to Virgin Money stakeholder pensions without an IFA (though since moved them on after reading here that they weren't very competitive).

Regards