Transfering money from AEGON pension whilst still paying into it?

normPad

Hello,


I have a company money purchase pension with AEGON.
I pay into this each month and I've built up a 5 figure amount.
The fees on this are 0.45% a year - which is not too bad - but I can reduce that by transferring it into my SIPP.


I've looked at the AEGON account and it is not clear how to transfer the money to another pension.
I still want to pay into the AEGON account (company also paying in) but I'll remove the accrued balance to date.


Anyone else done this whilst still paying into the pension?

bigadaj

You would, normally contact the sipp and get them to get the money transferred.

I'm not sure you'll get a lot less than 0,45% though in a sipp if you're including fund costs so don't think you would be better off unless you are investing in soemthing fairly exotic.

It may be that your scheme doesn't allow this, some do and some don't so count cargos and find out, or go through your work pension system.

dunstonh

I still want to pay into the AEGON account (company also paying in) but I'll remove the accrued balance to date.

You will have to ask the employer if they will allow it. Many schemes do not allow partial transfers as the transfer would close the pension. If they do allow partial ones then you are ok.

The fees on this are 0.45% a year - which is not too bad - but I can reduce that by transferring it into my SIPP.

You are not going to be saving much over 0.45% and with it only being 5 figures, is it really worth the hassle?

Snakey

I wanted to do this with Standard Life but they don't do partial transfers (a definition which I'm told is wide enough to encompass taking the whole of the balance but still leaving the empty account open for further contributions - you actually have to close the fund you're transferring from).

Might be worth giving your lot a call though, as I'm told that different providers have different rules.

Uglymug

Prior to taking early retirement about 3 years ago my company pension was also with Aegon. I had to pay into the Aegon scheme because my company made it very beneficial.
In my last few years of employment I salary sacrificed a substantial amount of my salary to my company pension with Aegon (I had always planned to retire early).
About once a year I transferred my Aegon money to my Sipp. I left a nominal sum of £1.00 with Aegon to keep the Pension account open and ready for my next monthly payment.
My Sipp gave me a much wider choice of investments, I'm not a fan of funds, much preferring to invest in shares directly.
I don't even think my company was aware of what I was doing, they just continued to pay my monthly pension contributions to Aegon. Aegon were quite happy (eventually) to do the yearly transfer. I say eventually because the paperwork involved was initially a bit daunting and both Aegon and my Sipp provider used to blame the each other for any delays. (I always suspected it was Aegon that caused problems) I soon learnt that if I acted as a middle man and insisted that all paperwork went through me things worked much better because I always knew exactly at what stage in the transfer we were at.

jamesd

Snakey wrote: »

I wanted to do this with Standard Life but they don't do partial transfers (a definition which I'm told is wide enough to encompass taking the whole of the balance but still leaving the empty account open for further contributions - you actually have to close the fund you're transferring from).

Standard Life will allow it when an employer negotiates that as part of their contract terms. I asked my employer about this when they were setting up the scheme and so the scheme I'm in does have such a term. Two free transfers out then a modest charge for the rest, have to leave £5k in the account.

If a firm doesn't allow it the next thing to do is ask when the next auto-enrolment period will be after opting out to facilitate the transfer of the one you opted out of. Then get your employer to ask the firm if instead of doing it in that silly way they will modify the agreement to reflect auto-enrolment law reality and allow transfers out from time to time at some modest cost.

AnotherJoe

jamesd wrote: »

Standard Life will allow it when an employer negotiates that as part of their contract terms. I asked my employer about this when they were setting up the scheme and so the scheme I'm in does have such a term. Two free transfers out then a modest charge for the rest, have to leave £5k in the account.
.

I have a very similar deal with my employer, not sure if there is a restriction in the number of xfers out, but you must leave £5k

However I'm impressed the OP feels he can beat 0.45%. Can't be by that much of a margin. Is it worth it ? Are there better funds or shares in the SIPP ? You might regard it as worth it for diversification. That's my justification anyway, my SIPP has the high risk components, a company pension scheme tends to have more staid components. Stops me gambling everything on Patagonian toothfish futures.

Snakey

jamesd wrote: »

Standard Life will allow it when an employer negotiates that as part of their contract terms. I asked my employer about this when they were setting up the scheme and so the scheme I'm in does have such a term. Two free transfers out then a modest charge for the rest, have to leave £5k in the account.

If a firm doesn't allow it the next thing to do is ask when the next auto-enrolment period will be after opting out to facilitate the transfer of the one you opted out of. Then get your employer to ask the firm if instead of doing it in that silly way they will modify the agreement to reflect auto-enrolment law reality and allow transfers out from time to time at some modest cost.

I'm not sure I fully understand this! If you have time today would you mind running me through it again?

I have two group personal pension pots, both with SL by pure coincidence.
1. Old job - no more contributions since I left that job - a bigger employer so it had negotiated a much better set of charges, even for ex-employees.
2. New job - gets the current contributions (employer ones plus what used to be called AVCs which go in via salary sacrifice). Doesn't look like they managed any sort of a deal on charges. Paying over 1%, compared to about half that in the other pot, and I'm putting in £40k a year so the difference will become significant over time.

I'd love to decant the funds from 2 to 1 - ideally as and when they're made, but failing that once a year or something would be fine.

Standard Life told me that I can only do a transfer if I close pot 2, although this was the online chat function and although I was logged in I suppose I don't know if they were looking at my specific details or just advising generally. And I suppose I have no idea who was advising me and how much they really know.

Is it worth asking my employer whether there's anything in their agreement with SL that would override the default "no"? Is it the kind of clause that might just happen to be in there by pure good fortune?

p.s.
1. Sorry for the hijack, OP.
2. Joe - Patagonian toothfish?!

bigadaj

Snakey wrote: »

I'm not sure I fully understand this! If you have time today would you mind running me through it again?

I have two group personal pension pots, both with SL by pure coincidence.
1. Old job - no more contributions since I left that job - a bigger employer so it had negotiated a much better set of charges, even for ex-employees.
2. New job - gets the current contributions (employer ones plus what used to be called AVCs which go in via salary sacrifice). Doesn't look like they managed any sort of a deal on charges. Paying over 1%, compared to about half that in the other pot, and I'm putting in £40k a year so the difference will become significant over time.

I'd love to decant the funds from 2 to 1 - ideally as and when they're made, but failing that once a year or something would be fine.

Standard Life told me that I can only do a transfer if I close pot 2, although this was the online chat function and although I was logged in I suppose I don't know if they were looking at my specific details or just advising generally. And I suppose I have no idea who was advising me and how much they really know.

Is it worth asking my employer whether there's anything in their agreement with SL that would override the default "no"? Is it the kind of clause that might just happen to be in there by pure good fortune?

p.s.
1. Sorry for the hijack, OP.
2. Joe - Patagonian toothfish?!

There shouldn't be anything against you shutting your pension on an annual pension, transferring that, and then restarting at the start if the new tax year.

Many pension charges increase when you stop contributing so it would be worth checking tags the old pension will accept a transfer in and charges will still be low. As its the same pension comoany you'd have thought they would be preferring the higher charges going into their coffers. To avoid all that hassle then James has suggested that it would be easier to negotiate a transfer into the contract which would save everyone time and presumably money, you can but ask.

I think the tooth fish reference was to exotic investments proposed when people transfer pensions at the suggestions of cold callers, normally to the detriment of the pension holder.

dlstafford

Hi,

Just came across your post. Can I ask whether they charged you for this transfer on a yearly basis and, if so, how much it the charge was?

dlstafford

Uglymug wrote: »

Prior to taking early retirement about 3 years ago my company pension was also with Aegon. I had to pay into the Aegon scheme because my company made it very beneficial.
In my last few years of employment I salary sacrificed a substantial amount of my salary to my company pension with Aegon (I had always planned to retire early).
About once a year I transferred my Aegon money to my Sipp. I left a nominal sum of £1.00 with Aegon to keep the Pension account open and ready for my next monthly payment.
My Sipp gave me a much wider choice of investments, I'm not a fan of funds, much preferring to invest in shares directly.
I don't even think my company was aware of what I was doing, they just continued to pay my monthly pension contributions to Aegon. Aegon were quite happy (eventually) to do the yearly transfer. I say eventually because the paperwork involved was initially a bit daunting and both Aegon and my Sipp provider used to blame the each other for any delays. (I always suspected it was Aegon that caused problems) I soon learnt that if I acted as a middle man and insisted that all paperwork went through me things worked much better because I always knew exactly at what stage in the transfer we were at.

Duplicate post but forgot to quote the original.

Can I ask whether they charged you for this transfer on a yearly basis and, if so, how much it the charge was?