Transferring to a drawdown pension

Arkwright9772

Hi folks...

I recently discovered a private pension which was set up when I opted out of SERPS in 1986.

The pension pot is with the Prudential and I contacted them last week to try and claim my pension when I reach 55 at the end of January. I have already taken advice and wish to convert my pension pot into a drawdown pension. However, Prudential will not allow me to do this on my own and have a policy that it can only be done through a financial advisor.

I have spoken to the Prudential financial advisor and they have informed me that they can transfer the pot into a Prudential drawdown scheme but want to charge me £1800.00 for the privilege.

I'm not inclined to want to pay them that kind of money and feel I'm being held to ransom somewhat. I know exactly what pension product I want and they intend charging me £1800.00 just to fill in the paperwork.

Anyone have any suggestions?

Many thanks....

Silvertabby

Does the pension plan have a GAR (a guaranteed annuity rate) ?

HappyHarry

Prudential only retail their products through financial advisers. If you want a Prudential product, then you will have to use one, and pay their fee.

However, if you want a different provider's product, and that provider does not insist on you using an adviser, then that provider will be able to assist you in moving your pension from Prudential.

Arkwright9772

Silvertabby wrote: »

Does the pension plan have a GAR (a guaranteed annuity rate) ?

Hi... How would I find out?

Arkwright9772

HappyHarry wrote: »

Prudential only retail their products through financial advisers. If you want a Prudential product, then you will have to use one, and pay their fee.

However, if you want a different provider's product, and that provider does not insist on you using an adviser, then that provider will be able to assist you in moving your pension from Prudential.

Thanks for your response. I don't necessarily want a Prudential product, I just assumed it would have been much easier and cheaper transferring my Prudential pension pot to another Prudential product.

Pension_Geek

To find out if it has a GAR (guaranteed annuity rate) you would just need to phone and ask them.

Off the top of my head, it’s only Ex Scottish amicable products that have these, but it’s definitely something to check.

It’s not necessarily cheaper to stay with the same provider. Provided it hasn’t got Any GARs (which are safeguarded benefits) you don’t need advice and can move the pension to one that allows drawdown.

dunstonh

I know exactly what pension product I want and they intend charging me £1800.00 just to fill in the paperwork.

Do you know exactly which product you want? it doesnt seem it otherwise you would not be entertaining the Pru sales rep.

If not Pru, which provider, product version and investments do you want?

How would I find out?

Ask Pru.

Thanks for your response. I don't necessarily want a Prudential product, I just assumed it would have been much easier and cheaper transferring my Prudential pension pot to another Prudential product.

It probably will be cheaper than the existing product and breakeven in costs within in a handful of years. However, I wouldn't want Pru's product. Why do you?

Arkwright9772

dunstonh wrote: »

However, I wouldn't want Pru's product. Why do you?

I think maybe I worded my statement wrong about "knowing exactly which product I wanted"

I only have one plan for this particular pension pot and that is to get every penny out of it as quickly and tax efficiently as is humanely possible. So in essence, I'm not particularly bothered if it stayed with the Pru in the short term. I would just rather not give them £1800.00 in fees if I could avoid it.

atush

Will the money in t he drawdown be invested or held in cash? Will make a difference is who is cheapest.

How many years will it take you t empty the pot? Will it be your only income n thssst time, or will you still be working? This will make a differencce in any tax you pay.

Is this your only pension?

jamesd

Arkwright9772 wrote: »

wish to convert my pension pot into a drawdown pension. However, Prudential will not allow me to do this on my own and have a policy that it can only be done through a financial advisor.

There are two potential reasons for that:

1. them only selling via advisers so whatever Prudential product for drawdown you want by their sales policy you must use an adviser. The remedy to this is to switch to a non-Prudential product instead.

2. there could be a guaranteed annuity rate and this could be 8-10% and a better choice than drawdown unless life expectancy is low. By law if the value of the guaranteed benefits exceeds £30,000 they are required to see proof that you have taken financial advice.

AnotherJoe

It shouldn't cost anything to transfer it to someone else who will do drawdown
Depending how you intend to draw it down there are pros and cons about the different comps you can use.