Pension Charges

matchplayer

I have been advised to move my pension, (ten years since last contributed to a works pension) sitting at £34000.
I will receive a bonus of £2400 for quitting current one, as i say dormant for 10 years!
FA will get paid commision of 5% on 1st £15,000 then 4% on between £15001 & £20,000 then 3% on remainder. Adding up to £1400. Does that seem reasonable cost? I am thinking of shopping around maybe two other (Local) advisors as this was from cold calling.
Will there be much difference or do they all charge this same structure? Thanks for reading any help much appreciated.

Lokolo

That is quite expensive imo. Overall cost of 4.1%. Definitely not worth it.

Go around a few local IFAs, get a free hour session. Find out the costs. Then report back here with any questions you may have.

There are a couple of things you want to think about; whether you want ongoing advice (for which there is usually a cost) and whether you want to be able to add additional contributions to it (if you aren't currently contribution to another pension, this would be a wise thing to do).

Tammer

Hi,

Why do you get a bonus for quitting?

What type of pension scheme is your pot currently in?

T

jem16

matchplayer wrote: »

I have been advised to move my pension, (ten years since last contributed to a works pension) sitting at £34000.

Who advised you?

I will receive a bonus of £2400 for quitting current one, as i say dormant for 10 years!

Who is paying this bonus and why?

FA will get paid commision of 5% on 1st £15,000 then 4% on between £15001 & £20,000 then 3% on remainder. Adding up to £1400. Does that seem reasonable cost? I am thinking of shopping around maybe two other (Local) advisors as this was from cold calling.

Commission has been banned on advised cases since the beginning of the year.

As you have been cold called and talking about paying you a bonus, my concern is that this is a scam which would result in you losing far more than £1400. If I were you I would not touch this with a bargepole.

If you really would like a pension review definitely see some local IFAs - ie not FAs. If you have no recommendation use https://www.unbiased.co.uk to find some.

mania112

I assume this is a With Profits Terminal Bonus?

Don't do ANYTHING from a cold call - see a local firm.

The charge is quite high, 3% on the whole lot is alot more reasonable.

matchplayer

Yes Mania112 it is "with Profits Terminal Bonus"
Maybe not exactly Cold Calling, I completed an on the phone survey, I assure you I never ever do them, just hang up, dont know why i changed my mind this time. I suppose because I knew it was time I did do something about my pension. Therefore I think they asked if they could get someone to call back with advice.
It is a company called "Profile Financial Solutions" They sent someone yesterday by arranged appointment, for me to sign the necessary forms. I bit the bullet and refused, till i had taken other Independant advice. 1st call was on here, but I will seek local IFA. Would love to have personal recommendation, but thats not always perfect either.
I would rather just pay a fixed fee, rather than % of what I am shifting/Investing.

dunstonh

I will receive a bonus of £2400 for quitting current one, as i say dormant for 10 years!

No you dont. They pay you an unauthorised payment out of your pot.

It is a company called "Profile Financial Solutions" They sent someone yesterday by arranged appointment, for me to sign the necessary forms. I bit the bullet and refused, till i had taken other Independant advice. 1st call was on here, but I will seek local IFA. Would love to have personal recommendation, but thats not always perfect either.

Thank goodness. You were close to being scammed out of your pension.

atush

Sounds like you made a lucky escape.

It had scam written all over it, you could have lost the lot in some unregulated scheme then been charged a huge fee on top by HMRC.