Getting a second pension

mascensao

I have a pension with my current employer but wanted to start another one, my bank HSBC said I can’t have a stakeholder pension with a work pension, is this information correct? If it is, then what about getting a private pension in another European country, I have dual citizenship with two European countries.

Thanks in advance for any help

dunstonh

Its potentially right but it can also be potentially wrong. It depends on the type of pension your employer offers and your income.

Let us know what type and your income and we can confirm/deny what you have been told.

mascensao

I have no idea what kind of pension it is, but if it helps, I work for a London Council and earn £21k

dunstonh

Almost certainly in the local government pension scheme and earning 21k means that you are able to contribute towards a stakeholder.

I'm afraid that HSBC were incorrect on this occassion.

Pal

Some local government pension schemes offer added years and money purchase AVC options, which you should consider contributing to first before worrying about a stakeholder.

Milarky

Interesting - I found this by google search:

http://www.ukbusiness.hsbc.com/public/ukbusiness/decisionmaker/shp2/desc1.jhtml

When you come down to 'Question 5': Are you currently a member of your employer's occupational pension scheme and intend to leave? and select 'Yes' - because you are already a member - it returns the result:

You are not able to start a Stakeholder Pension plan with us as you have an occupational pension scheme available for you to join.

NOTE that you are not asked at any point: "Are you a member - will you remain a member - do you want to open a separate plan?"

So it would appear that just this provider - HSBC - which declines to offer a stakeholder where it (I am assuming) deems any employer's scheme to automatically be a superior alternative. [Might they be worried about 'misselling?']

Pal

Yep. It also appears to ignore the fact that people earning under £30k can use a stakeholder as a top up vehicle.

Alternatively they might believe that anyone using a stakeholder to top up their occupational scheme is not likely to contribute enough to make it worthwhile offering a policy.

dunstonh

Sometimes tied companies will put some blocking rules in place to prevent potential mis sales. It doesnt mean that it cant be done. It just means that particular company wont do it. In this case, a stakeholder is allowable but HSBC wont do it.

Back in my tied advisor days, we were not allowed to recommend ISAs for retirement planning even when ISA was the most suitable product.