Transferring a pension

Wrongers

Hi


I looking for some advice as to whether moving my pension is the best option.
I have a Talisman plan which I've had since the 90's. I recently enquired about a payment holiday and was told that I could have a holiday of 12 months but for that I would be charged 0.02% of the premium value every year until the policy comes to term. If I stopped paying into the policy altogether and then took out another policy after the 12 months for that I would be charged 0.40% every year. If I reduce payments I will also be charged. I understand that there will be a fee to transfer the policy but wonder if it would be worth that in the long run. If I was to lose my job or my financial circumstances were to go down for any reason I would still have to pay my monthly premium. So if I transfer to a new plan that offers more freedom will I incur charges from the new plan or would the monthly premium start working for my new pension straight away?

bigadaj

Older style plans tend to be expensive, the one thing they may have is valuable guarantees on annuities and payout so whether these exist needs to be checked.

Otherwise you may well be better transferring out, modern pension plans will have typical charges of around 0.5%, though you can pay a lot more.

How much is the pension pot currently, if a larger sum then it may be worth going to an ifa as his charges would be more than recovered in savings in charges.

Wrongers

Thanks for your relpy. The pot is currently £45k

dunstonh

have a Talisman plan which I've had since the 90's. I recently enquired about a payment holiday and was told that I could have a holiday of 12 months but for that I would be charged 0.02% of the premium value every year until the policy comes to term.

Talisman was a brand name used by Royal London (ex Scottish Life). These plans very frequently have guaranteed annuity rates. Rates that are much higher than the open market and valuable. Stopping these plans if you do have a GAR can be a costly mistake.

The Talisman plans are more expensive than modern plans but it doesnt matter. Cost is a secondary consideration and not the primary one. You should not be deciding on cost alone.