Pension - charges to transfer into SIPP

LHW99

To follow up on some of the points mentioned, yes I was thinking my best option would be to stay in the Bank pension and just diversify within there a bit more - I did make this point during my conversation with the advisor, but he seemed to think I couldn't diversify if I stay in the Bank's scheme as it would be all equities.  Not sure this is correct as I know that 10 years before Target retirement age they start moving funds into more cash based investments, bonds and the like.

That sounds like a type of Lifestyling, which assumes you will buy an annuity at the date you retire. If you may not want to do that, there may be an option to turn off Lifestyling, or to cheat by making your "retirement date" 70, or 75 to delay the changeover.

If you decide at 60 or so you want to use drawdown in retirement, you can / may have to move the pension, which would then be before Lifestyling has made much of a change.

Gary1984

Don't transfer with this guy. I don't think he has your interests at heart.

If your current scheme lets you then maybe dial down property to 5% and move the other 15% into some sort of bond index. I would caution against disregarding bonds as suggested by an earlier poster as they are the best value they've been in years.

If you really are medium risk then 80% equities might be considered high as well and moving some of these into bonds too might fit your risk profile better.

Albermarle

As mentioned you need to be careful of so called Lifestyle product that automatically change your mix of investments as you get near retirement.
There are two basic types.
One is aimed at you buying an annuity with the pension pot when you retire ( annuity meaning exchanging the pot for a guaranteed income). In this case it makes sense to move the pot to lower risk/return investments and more to 100% cash as the date gets closer, because the last thing you want is for the value to crash at the last minute.
The second is aimed at you moving into drawdown, where you keep the pot and slowly withdraw from it. In this case it is better to stay mainly invested in a medium risk type fund,rather than moving to cash as the pot maybe has to last you 30 years.

The big problem is when you are planning to withdraw via drawdown, but you actually are in the annuity lifestyle product, as this used to be the default product.

MIZZ12

Thanks all.  Just had a follow up session with the Bank advisor today (where I also flagged my concern around the charges) and he has put the frighteners on me saying that it's a high risk strategy to leave my pension pot in the Bank as the investments are not actively managed, at least no where near the extent of how they would be managed if I moved them into a SIPP through the implementation fee route he advised. 
He was saying things like if I decided to leave my pension pot in the bank and if I tried to diversify within that, how would I know when to move out of certain markets etc.  He has left me feeling very uncomfortable, like it would be foolish if I left my pension pot where it is.  He did tell me that he moves his own pension pot out of the bank every year and into a sipp so that he has access to more funds and investments so I think he believes this to be the best strategy.   But is it worth the £10k fee plus ongoing 0.63% AMC.  This is my dilemma.  Your views would be greatly appreciated.   Thank you. 

Pat38493

If you are thinking about spending thousands of pounds on advice, you should get an IFA (Independent financial adviser) rather than this person - I am pretty sure that this person is not an IFA as they would not be giving you the hard sell like that.

Being 80% invested in equities is not necessarily a huge issue, depending on what your withdrawal strategy is going to be and when you are planning to stop work.  I certainly wouldn’t see it as a reason to be scaremongering - I would not set up a business relationship with someone who is trying to scare me into doing something.  If they are a good adviser, apart from anything else they should be able to explain to you in a way that is clear and true, why they think you should do this.

Beddie

It sounds like this "adviser" is a typical slimy salesperson who only has their own interest at heart, and will lie to you just to get a sale. "Free" indeed....

Keep well away from this dodgy character's proposals.

Albermarle

He has left me feeling very uncomfortable, like it would be foolish if I left my pension pot where it is.

So his sales tactics worked perfectly. He has been well trained !

QrizB

MIZZ12 said:

Thanks all.  Just had a follow up session with the Bank advisor today (where I also flagged my concern around the charges) and he has put the frighteners on me saying that it's a high risk strategy to leave my pension pot in the Bank as the investments are not actively managed, at least no where near the extent of how they would be managed if I moved them into a SIPP through the implementation fee route he advised.

He's a chancer. Stay away from him.

MIZZ12 said:

He was saying things like if I decided to leave my pension pot in the bank and if I tried to diversify within that, how would I know when to move out of certain markets etc.

If he claims he can time the markets, he's lying. Pure and simple.

Anyone who could really do what he's claiming wouldn't be behind a desk in a bank, they'd be sipping drinks on the deck of their private yacht, anchored just off the coast of their private island.

MIZZ12 said:

He has left me feeling very uncomfortable, like it would be foolish if I left my pension pot where it is.

Tht's what earns him all those sweet, sweet fees.

artyboy

OP - if you really do have "the frighteners" then please, PLEASE, seek out an INDEPENDENT Financial Adviser to review your finances with. Do not give this shiny suited charlatan one more moment of your time.

You work in a bank. I get that doesn't necessarily make you an expert on investments, but please, you really need to wise up!!!

penners324

Stop speaking to this person.

Your money is perfectly fine in the pension scheme it's currently in