Wish to move EPP to something better

philipwelch101

I was an IT Contractor for about 4 yrs and during that time set-up a Executive Personal Pension with Royal and Sun Alliance. I went permanent about 3 years ago and have since closed down the company. Currently, I have about £11,000 sitting in the EPP, but have not added any premiums for about 3 yrs and it is being hit by charges and not growing very much. I have tried to move into something a little more efficient several times but as yet have not felt confident enough.

I really want to move from R & SA, but have no idea what to go to. I have had conflicting advice from various Financial Advisors and some that will not commit to anything unless I pay up front.

Can you give some advise on what I should do or who I should accept advice from.

dunstonh

EPP transfers require further qualifications/licencing. This narrows the number of advisors down that can transact on your behalf. Then you have to consider that an EPP may be the best thing for you but it would just be a switch of investment funds with your existing provider. After all, the EPP is one thing, the investment is another. If you are not happy with the investment, you change it without changing the product. So, this should explain why they want you to pay fees. 1 - you want specialist advice and 2 - they probably wont earn from the provider so you have to pay them.

An EPP to EPP doesnt itself require any licencing above the norm but it would require a cost analysis of the existing plan and the charges involved in transfering. These would be compared with staying put and moving to alternative funds. A transfer analysis incurs a fee to the IFA whether you take advantage of it or not so that would be passed on.

A fee between £250 and £400 would seem acceptable for this class of business for just a report. If you then did a commission paying transaction, that fee would normally be waived as long as the comm cover it. Alternatively, you could extend the fee arrangement which could go to around £600-£800 in total but the alternative product arranged on nil commission terms. Depending on the term to maturity, the lower charges could save you more than fee over the term. Commission may be the cheaper option though.

Or you could do it yourself. Although I dont know many insurers that will do EPP business without an advisor being onboard.

HLK

I'm in the same situation as Philip who made the original post. What I would like to know, and have had conflicting advice on , is - can I transfer my EPP to a Stakeholder. The EPP is expensive to run as charges are high and I'm the only member of the scheme. I currently have a stakeholder with my employer.
Any advice would be welcome.
Thanks.

paul666

You *can* convert your EPP(s) to a standard stakeholder(s). I've converted EPP's (contractor style) from Abbey Life and Scottish Mutual to L&G and Virgin stakeholders. The most difficult part is having the nerve to go ahead with it, 'secure' in the knowledge that until the cash is in the stakeholder, you've no idea what the final transfer amount will be. Especially, with the S.M. with-profits fund where the MVA can change without warning...

I recently saw an article saying that Abbey National/Scottish Mutual had decided to cease their MVA's and Annual Bonuses on w/profits so if I'd waited, I might have kept, maybe, 1k more in the transfer (or maybe not).
So, yeah, it's entirely possible, but it's quite a nerve wracking thing to do.
You need to understand what you're giving up and what you might gain in terms of charges, investment allocation, fund choice, flexibility, etc)