Royal London / Scottish life offer

plumb1_2

I have a pension with Scottish Life (Tailsman)  which is now run by Royal London 
I have just received a voting pack saying they would uplift my qualifying with profits by 29.9% if thee vote goes through.
But the also state that that if it doesn’t proceed the bonus when I retire in 2yrs could be between 13% and 30.7%.  Why can’t they give a direct figure?

Qualifying with profits £142,600 other investment £47,209 total £189,809
If I vote yes they state £190,000 is that just for my qualifying with profits??

I phoned royal London yesterday for my transfer value and it was £193,000, so a bit confused now😊

I also have a stand life and company pension.

dunstonh

I have just received a voting pack saying they would uplift my qualifying with profits by 29.9% if thee vote goes through.

Excellent.  That would indicate they are carrying this on.

However, be on guard as some Talisman plans have very good double digit GARs.   The offers so far have generally been fair and good for small value plans but a decent double digit GAR could be worth keeping.

But the also state that that if it doesn’t proceed the bonus when I retire in 2yrs could be between 13% and 30.7%.  Why can’t they give a direct figure?

How much is the stockmarket going to go up or down tomorrow?
or the day after
or the day after.......

You cannot gave a direct figure when future investment returns are completely unknown and unpredictable.

Qualifying with profits £142,600 other investment £47,209 total £189,809
If I vote yes they state £190,000 is that just for my qualifying with profits??

What does it say on the letter about that?
However, I suspect from the values that it means the qualifying figure only.

[Deleted User]

If its a “with profit” fund then the uncertainty is likely due to future returns on bonds rather than stocks.  I wouldn’t bet on anything near 30.7% in two years.

FatFred66

plumb1_2 said:

I have a pension with Scottish Life (Tailsman)  which is now run by Royal London 
I have just received a voting pack saying they would uplift my qualifying with profits by 29.9% if thee vote goes through.
But the also state that that if it doesn’t proceed the bonus when I retire in 2yrs could be between 13% and 30.7%.  Why can’t they give a direct figure?

Qualifying with profits £142,600 other investment £47,209 total £189,809
If I vote yes they state £190,000 is that just for my qualifying with profits??

I phoned royal London yesterday for my transfer value and it was £193,000, so a bit confused now😊

I also have a stand life and company pension.

The uplift is only on the 'qualifying with profits' part of of your plan. So £142,600 + 29.9%. I think they've calculated the £190,000 on the assumed value of your plan on 31/12/2021. So your total transfer value now is £193,000 and your total transfer value on 01/01/2022 may be around £238,000.

The reason they can't give an exact figure for what you'd get if the vote doesn't go through is explained quite well on pages 7-9 of Explanatory Booklet Part A.

Personally I'm taking the 'bird in hand' view and deciding that an immediate 29.9% increase is a much better thing than a potential 13-31% uplift some time in the future, depending how things work out.

If you can still make payments into your plan it's worth me pointing out Section 3.3 (that's the bottom of Page 11) of Explanatory Booklet Part A. The 29.9% Uplift also applies to payments made into a qualifying plan AFTER the Implementation Date. Let that sink in. 

Unfortunately my plan's been made 'paid up' and they won't accept any further payments. 

FatFred66

dunstonh said:

I have just received a voting pack saying they would uplift my qualifying with profits by 29.9% if thee vote goes through.

Excellent.  That would indicate they are carrying this on.

However, be on guard as some Talisman plans have very good double digit GARs.   The offers so far have generally been fair and good for small value plans but a decent double digit GAR could be worth keeping.

Page 14 of Explanatory Booklet Part A. Any GAR won't be affected if the scheme goes forward.

plumb1_2

FatFred66 said:

plumb1

If you can still make payments into your plan it's worth me pointing out Section 3.3 (that's the bottom of Page 11) of Explanatory Booklet Part A. The 29.9% Uplift also applies to payments made into a qualifying plan AFTER the Implementation Date. Let that sink in. 

Unfortunately my plan's been made 'paid up' and they won't accept any further payments. 

FatFred66 

If you can still make payments into your plan it's worth me pointing out Section 3.3 (that's the bottom of Page 11) of Explanatory Booklet Part A. The 29.9% Uplift also applies to payments made into a qualifying plan AFTER the Implementation Date. Let that sink in. 

Unfortunately my plan's been made 'paid up' and they won't accept any further payments. 

Thanks for the replies, I have just read section 3.3
Dont quite understand it fully, is it saying that any money I put in will qualify for the 29.9% uplift .
I only pay in £50 p/m  to it, So if it does qualify for the uplift is it best to pay £500 p/m or can I put a £10 k lump sum in it .

FatFred66

plumb1_2 said:

Dont quite understand it fully, is it saying that any money I put in will qualify for the 29.9% uplift .

That's how I read it. 

"The Payment amounts you make won’t be affected by the Scheme. However, if the Scheme goes ahead, the Royal London Open Fund will top up your Qualifying Plan Value by applying the same 29.9% Uplift for any Payments made into Qualifying With Profits after the Implementation Date as and when you make them.

Because we don’t know exactly how many Payments each Included Planholder will make into Qualifying With Profits in the future, we have to estimate the expected value across all plans still making Payments into Qualifying With Profits.

The Estate of the Royal London Open Fund will be provided with this value by the Estate of the Scottish Life Fund, which we call the Payment Uplift Contribution. In exchange, the Royal London Open Fund will agree to top up Qualifying Plan Values by applying the Uplift for Payments invested into Qualifying With Profits after the Implementation Date as and when these are made. 

The Royal London Open Fund will apply the Uplift for these Payments whether or not the Payment Uplift Contribution ends up being large enough to Uplift the Qualifying Plan Values for the Payments made in the future."

plumb1_2

Hi on page 11 section 1 it says something about closed fund contributions 31/03/21, does that date stop any further payments qualifying?

Also in the personal illustration section 3 eligible plans  claimed after 1 st jan 22.

Sorry for all the questions 😳

FatFred66

I'm not an expert on this at all, I'm in the same position as you and this is just my understanding of what they've sent me. The booklet is available here if anyone more familiar with this sort of thing can spare the time to look at it.

I think it's a 'closed fund' in that it's not open to new members - and that's been the case for a while. The 'Closed Fund Contribution' is the amount of the Scottish Life Estate which will be transferred to the Royal London Open Fund in return for this jiggery-pokery.

It's there in black and white (or green) that not only will future payments be subject to the Uplift but they've no way of knowing what the future payments might be and the Royal London fund accepts that risk.

'Plans claimed after 1st Jan 2022' just means that if your retirement date (or a transfer date) is before that date you won't get anything under this scheme.

Don't forget that this still has to be voted for. They might not go ahead with it. 

I was in the process of transferring this pension because of its poor performance, before I read about this proposal. It seems exceptionally unfair to people who've taken their pension or transferred out in the last couple of years and very generous to anybody who's still able to make payments in.

The retirement date for me on this plan was next month. I've delayed it a year to take advantage of this scheme. It's distributing money that's been built up over the 32 years they've had my investment. Why should I lose out for the sake of 2 months? I'd be fuming if that had happened, even if I had completely forgotten about the existence of this pension until 3 years ago. 

plumb1_2

Thanks for the help Fatfred66, think it’s a bit more clear to me now (doh) 😳
Great you are benefiting from it, I’ve only 2 yrs to go.
interesting you say it’s a poor performance personality I wouldn’t have a clue.

So as  I understand it, the 29.9% uplift will be added to the qualifying portion when the pension is taken in about 2 years and not before?

FatFred66

It says they'll apply the uplift to the Qualifying Plan Value on 31st December 2021 so I assume their system will just be updated with the new value on 1st January. That's what they seem to be implying anyway.

The alternative scenario, if the scheme doesn't go ahead seems to be that the plan value stays the same until you actually claim and then you get this unexpected '13.0% to 30.7%' bonus which hasn't been mentioned before. Why I'd get '13.0% to 30.7%' if I transferred out next year but (apparently) wouldn't have got a penny if I'd transferred out this year is beyond my understanding. Maybe 'claiming' a pension is something different from transferring? Can anyone throw any light on that for me?