Not a question about the new LTA!

Snakey

This is a question about having two pension plans with the same provider. I'm just wondering how it all works.

I have a "Group Personal Pension Plan" with Standard Life from my old employer, with a large chunk of money in it. I am starting a new job which also has a Group Personal Pension Plan with Standard Life. (The HR dept refers to it as a Stakeholder Pension Plan, but the employment contract says GPPP so I assume it's one and the same.)

I have nice reductions in the charges in my existing plan, as my old employer is big, and even the lower "ex-employee" rebates aren't to be sneezed at. I doubt there'll be any such reductions with the new place as they're pretty small fry.

So... how does this all work at the business end - the bit that's normally hidden to me as an end customer but that the employer has to interface with?

I'm hoping that it might somehow be all the same thing and my new employer can (effectively) pay into my existing Plan without caring and I carry on getting the fee reductions on everything.

Or is it not that easy and there's actually a real demarcation within SL between the various employers that they run group plans for? I doubt my new employer will pay into the plan of my old employer if it involves doing anything difficult or having to remember to do something special each month, and I totally understand why.

If that's the case, am I allowed to run two plans in parallel with the same provider - one that I keep paying into, the other that I don't? Standard Life couldn't force me to transfer the old balance into the new plan and lose all the benefits of the old one, could they?

Any advice for me? Or am I over-thinking and I should just rock up, sign on to the new plan, and don't worry about it?

Thanks for reading!

jamesd

No problem to have two plans at the same time with the same provider. Your employer is unlikely to pay into the plan you already have but ask about making periodic transfers to it.

The old plan will probably have bundled charges and commission payable to someone. The new one will probably have unbundled charges and even without discounts might end up cheaper. No way to be sure without checking the costs for each for the funds you have. The older SL pricing I've seen inflates the base fund costs then discounts off those inflated prices so to some extent the discounting is illusory.

Depending on how substantial the amount is it might be cheaper to move the existing SL money somewhere else.

Snakey

Cool, I'll ask them about doing transfers - it sounds like that wouldn't be something that I'd need to set up in advance of starting the new job, which takes the time pressure off.

You know, I didn't even think of them inflating so that they could offer a discount without being left out of pocket! In case you happen to be familiar with their charges and can do a gut-feel comparison for me, the rebates I get bring the "effective total annual fund charge" down to the following (at the higher "ex-employee" rates, they were 0.2% lower before):
SL European Equity - 0.48%
SL Far East Equity - 0.55%
SL NA Equity - 0.47%
SL Property - 0.47%
SL UK Equity - 0.47%
SL Int Equity - 0.48%
SL Asia Pac ex Jap - 0.59%
SL Overseas Equity - 0.48%
SL Blackrock UK Equity Tracker - 0.47%

WDYT - worth keeping the plan, for these rates?

I have about £670k in there, with at least 15 years to go till a nice early retirement if the legal goalposts don't move again before I get there.

jamesd

For context you can get a UK equity tracker for around 0.15% fund charge or less but would have to add on a platform charge of some sort.

Snakey

Yikes, OK, so these rates are more like "they're better than we're pretending that we would have otherwise charged you" and not actually low at all!