Pension Transfer with GAR.

Couch_potato_46

Hi,

This might be an easy question but a quick google couldn't give me the answer. My partner and i are looking to transfer a pension with a value of approx. 20k but after a phone call Royal London say that we need to take advice as she has 2 separate policies that combined total 45k. Is this information correct ?

Thanks

dunstonh

Is this information correct ?

Yes it is.   The combined value is what matters with linked plans from the same provider as it was a way to prevent attempts to circumvent the rules by splitting plans up into smaller ones to stay under the 30k rule.

Is it a Royal London Talisman plan or an ex CIS personal pension? (the former has very good GARs. The latter less so)
What are the GARs?

Couch_potato_46

Thanks for the response Dunstonh. Yes, it is an ex cis pension. The GARs are 4% pre 97 and 2.8% Post I think (don't have the paperwork in front of me). This is with 3% escalation and 50% spouse at 60. The other pot I believe is 6% level. Thanks

dunstonh

Couch_potato_46 said:

Thanks for the response Dunstonh. Yes, it is an ex cis pension. The GARs are 4% pre 97 and 2.8% Post I think (don't have the paperwork in front of me). This is with 3% escalation and 50% spouse at 60. The other pot I believe is 6% level. Thanks

I fear you may struggle. 

An adviser overruling a GAR to allow you to transfer to a scheme of your own is a high-risk transaction that will cost the adviser firm every year forevermore (its an underwriting question on their liability insurance and often each case is asked about individually and risk assessed and premium adjusted).   You will no doubt find an adviser willing to offer their services but I suspect the price will be set to reflect the risk.  And that price will be high relative to the fund values.  I would expect many advisers to say it's not cost-effective for them or you to offer that advice.

It is possible that Royal London will run another opportunity to buy you out of the GAR.  They did this for ex Scottish Life plans in 2018.  They have yet to do it for other brands they have taken on.   

Couch_potato_46

Yes, I agree that it would not be cost effective so we won't be pursuing it. I was aware of the Scottish Life buy out and hope that we get the opportunity as well, we have 3 years before she turns 60.