Best Way Forward into Drawdown With or Without an IFA

Guardsman01

I wonder if anyone can advise. I've retired and am currently in receipt of an occupational pension.

I also have a pension fund of £420k (probably £419k by now....) which is with Skandia. In 2011/12 I'd like to take the maximum £105k lump sum and enter into an income drawdown scheme with the balance of £315k. I'd like to "do it myself" - viz - ignore the IFA option and arrange and monitor everything myself. I have approached Skandia but they refuse to talk to me as I'm not an IFA.... I note that Skandia pay commission to IFAs of 3% to 4% of the initial value of the fund plus annual/tracker commissions. Is there any way I can get where I want to go on this or will I be forced to pay these sorts of fees for a service I don't require. Why won't Skandia (I assume their policy in this regard is the industry norm) deal with me direct in wishing, effectively, to switch the status of my current funds with them from "Personal Pension" to "Income Drawdown" status. Or am I being naive? I'm currently personally managing the funds I have with Skandia - i.e. without the involvement of an IFA. Thanks.

dunstonh

I also have a pension fund of £420k (probably £419k by now....) which is with Skandia.

Is that Skandia Life or Skandia investment solutions? I am going to assume its skandia life based on the contents of your post but do correct it if its wrong.

I'd like to "do it myself" - viz - ignore the IFA option and arrange and monitor everything myself.

no problem there.

I have approached Skandia but they refuse to talk to me as I'm not an IFA...

Skandia do not have any licence to provide advice or opinion. They can only supply factual information.

I note that Skandia pay commission to IFAs of 3% to 4% of the initial value of the fund plus annual/tracker commissions.

No they dont. Skandia, using the most likely contract you would use, "can" pay commission of up to 4.5% if the IFA chooses that option. However, you wouldnt be doing commission basis on a pot of that size unless you are silly and if you are already with Skandia then its just a case of making sure you are in the right contract and do an internal transfer. Its very easy.

Why won't Skandia (I assume their policy in this regard is the industry norm) deal with me direct in wishing, effectively, to switch the status of my current funds with them from "Personal Pension" to "Income Drawdown" status.

Because they are not authorised to do so by the FSA and what you want to do will involve the purchase of a new contract (As they would deal with you if your existing contract offered the unsecured pension option).

Your choice is either to agree a small fee to get the pension transferred over internally to the Skandia CRA or to move it to a DIY provider (although do note that the Skandia CRA will likely be cheaper than most DIY options if you are using funds).

Guardsman01

Many thanks for your clear guidance, dunstonh. I know know the best way to proceed.