Left company, forced to Transfer Pension - but where to!!

sunflower_lass

I left my previous company in November, after 18 months.

The pension company they use (Capita) contacted me last month to say that because I had less than 2 qualifying years, my only option is to Transfer Out...

Problem is, I don't know where to!

I am currently unemployed, and not likely to be back in work for another 6 months.

They say the plan is worth £4,500, but I'm only 28, so I guess I have a long wait before I can think about accessing it.

Might anyone be able to help me as to what to do with it? Can I just set up another pension somewhere else, even though I won't be paying anymore into it for quite a while?

Thanks so much if you can help me!

dunstonh

Problem is, I don't know where to!

You actually have two problems but the first problem is resolved with the second problem.
1 - you dont know where to
2 - most pensions will require an IFA to sign off on a transfer from a defined benefit scheme to a money purchase scheme (although the IFA will tell you who to use for the pension)

They say the plan is worth £4,500, but I'm only 28, so I guess I have a long wait before I can think about accessing it.

You may only be 28 but if this is your only pension then you are already falling behind. So, dont knock it. It is important and when you get into your 60s (which will be in no time as time speeds up more and more as you get older) you will thank yourself for any provision you did at a younger age.

https://www.unbiased.co.uk is the UK database of IFAs. Search by post code and make sure pension transfer specialist is selected (or an option to that effect). You may need to unselect the default option which only shows paying IFAs so it shows all IFAs locally. Otherwise your list may be a bit short.

thenudeone

The Capita scheme is not defined benefit (at least not for most people - it may be different for very senior managers) so it wouldn't need an IFA sign-off.

You could probably transfer it to any stakeholder pension or even a so-called low-cost SIPP

jem16

thenudeone wrote: »

The Capita scheme is not defined benefit (at least not for most people - it may be different for very senior managers) so it wouldn't need an IFA sign-off.

The mention of less than 2 qualifying years suggests it is a defined benefit scheme. It could well be Capita Hartshead who are the pensions administrators of the scheme.

Why do you think it isn't?

RichandJ

jem16 wrote: »

The mention of less than 2 qualifying years suggests it is a defined benefit scheme. It could well be Capita Hartshead who are the pensions administrators of the scheme.

Why do you think it isn't?

Given this quote by the OP:

"The pension company they use (Capita)"

I rather think the administrators are Capita (silent r) rather than the OP having worked for them.

Agree, it sounds like a DB scheme, leaver between 3 months & 2 years service, hence TV offered. Would this still need IFA sign off to xfer out, given it's xfer or refund option only ?

dunstonh

Would this still need IFA sign off to xfer out, given it's xfer or refund option only ?

In theory, this shouldnt need an IFA sign off but the product providers will typically still treat it as a defined benefit transfer as that is what the FSA would treat it as. Even though it is a no brainer of one. As the provider is unlikely to to take on that liability for themselves, I suspect an IFA will be needed.

robmatic

jem16 wrote: »

The mention of less than 2 qualifying years suggests it is a defined benefit scheme. It could well be Capita Hartshead who are the pensions administrators of the scheme.

Why do you think it isn't?

It's not necessarily DB: occupational DC schemes have the 2 year qualifying service rule as well.

xylophone

http://monevator.com/2012/03/13/cheap-stakeholder-pension/
anything here?
Find out from Capita what kind of scheme (Defined benefit /Defined contribution).

sunflower_lass

Wow, thanks everyone for your kind responses!

Apologies I didn't realise I hadn't given all the details; I've now looked through all my info again, to find out the following:

- It's a Group Pension scheme, run by Capita Hartshead (they have sent me a 'Transfer Out Option Form')
- I am fairly sure it's a Defined Contribution scheme.


From your helpful responses and my own research, I am tempted to set up my own Stakeholder Pension, with a discount broker such as Cavendish, with Aviva. (Thanks Xylophone for the article, and I've also read Martin's articles.)

I'm setting up my own business at the moment, so might not be able to pay any more into the pension for another year at least, but hopefully then I can pick up where I left off?!

thenudeone

jem16 wrote: »

The mention of less than 2 qualifying years suggests it is a defined benefit scheme. It could well be Capita Hartshead who are the pensions administrators of the scheme.

Why do you think it isn't?

I was an employee of Capita for several years and the pension was definitely DC not DB.

magpiecottage

In theory, a transfer of a pension can be done on an execution only basis. However, most providers (and IFAs) will be wary of it because of the risk of a complaint later on.

For an advised sale - even if it is only "transfer it or lose it so I recommend transferring" - the adviser needs to hold a suitable qualification (which most IFAs do not). This applies for transferring out of ANY occupational pension scheme, not just a defined benefit one.

As DunstonH says, you need a "pension transfer specialist".