Tranferring a pension ?

colliecrew

Hi all,
How easy is it to transfer a poorly performing Scottish Equitable pension into a SIPP ???
Appreciate any and all advice.

dunstonh

The Scottish Equitable pension doesnt perform poorly or good. Its the investment funds within it that do. The funds you choose on the SIPP can perform worse than the funds on the Scot Eq pension.

Scot Eq retirement annuity contracts and early personal pensions tend to have guaranteed annuity rates which can be very desirable. If you have one of these you can often require a very high rate of return on the alternative just to match the guarantee that is being offered. Make sure you arent missing there.

Transfers themselves are straightforward.

EdInvestor

In principle it's easy.You just open the account at the SIPP, then instruct ScotEq to transfer the money.Fill in a form or two.

Potential snags and risks:

1)Protected rights money can't yet go into a Sipp so may have to be either left behind, or moved to a second new conventional pension.
2) Some Sipps may require you to use an IFA, especially if the pension was originally from a company scheme
3)If in a WP fund, see note above on losing guarantees, this also applies to pensions from company schemes (eg section 32s)
4)Check charges on both pension and Sipp.Also check fund choice in existing pension - it may be easier just to switch the money over to investment in better (usually external) funds, rather than move the whole thing.

dunstonh

3)If in a WP fund, see note above on losing guarantees, this also applies to pensions from company schemes (eg section 32s)

It doenst just apply to With Profits. Quite a few offer GARs on their unit linked funds. This includes Scot Eq. The funds available may not be what an experienced investor would be looking for but there should be enough for a half decent spread which if used with the GAR can wipe the floor with the SIPP.