Transfer DC pension to another provider to access 25% tax free

Chickereeeee

A family member wants to access his pension to take his 25% tax free sum. His current provider does not allow this, so he would have to move  to another provider.

1) The pension pot is moderate/small in size. (He has previously approached IFAs, but they did not seem interested)
2) He knows nothing about investments, and wants somebody to manage it for him
3) I have pointed him towards Pension Wise for now.

What would be the easiest cheapest way for him to find a suitable, reputable  provider, to which he could transfer?

(I manage  my own SIPP, so this is not an area with which I have dealt before.)

Thanks.

Albermarle

A family member wants to access his pension to take his 25% tax free sum. His current provider does not allow this,

For sure older pensions can be more inflexible on how you can withdraw, but they would not normally not allow you to take the 25% tax free. Maybe they are insisting he takes an annuity?

If he really wants someone to manage it for him, he needs an IFA......

What he can have of course is just one simple managed fund within the SIPP. Some are targeted at particular retirement dates and explained well on their websites.

NoMore

Albermarle said:

A family member wants to access his pension to take his 25% tax free sum. His current provider does not allow this,

For sure older pensions can be more inflexible on how you can withdraw, but they would not normally not allow you to take the 25% tax free. Maybe they are insisting he takes an annuity?

If he really wants someone to manage it for him, he needs an IFA......

What he can have of course is just one simple managed fund within the SIPP. Some are targeted at particular retirement dates and explained well on their websites.

Possibly they have to take it all as a UFPLS to get the 25% tax free and the OP only wants tax free cash.

Marcon

Chickereeeee said:

A family member wants to access his pension to take his 25% tax free sum. His current provider does not allow this, so he would have to move  to another provider.

1) The pension pot is moderate/small in size. (He has previously approached IFAs, but they did not seem interested)
2) He knows nothing about investments, and wants somebody to manage it for him
3) I have pointed him towards Pension Wise for now.

What would be the easiest cheapest way for him to find a suitable, reputable  provider, to which he could transfer?

(I manage  my own SIPP, so this is not an area with which I have dealt before.)

Thanks.

Is his pot over £30K?

Does it have any special features such as a Guaranteed Annuity Rate?

If the answer to both the above is 'yes', then he needs specialist advice from a regulated adviser if he wishes to transfer to another pension plan.

tacpot12

Marcon said:

Chickereeeee said:

A family member wants to access his pension to take his 25% tax free sum. His current provider does not allow this, so he would have to move  to another provider.

1) The pension pot is moderate/small in size. (He has previously approached IFAs, but they did not seem interested)
2) He knows nothing about investments, and wants somebody to manage it for him
3) I have pointed him towards Pension Wise for now.

What would be the easiest cheapest way for him to find a suitable, reputable  provider, to which he could transfer?

(I manage  my own SIPP, so this is not an area with which I have dealt before.)

Thanks.

Is his pot over £30K?

Does it have any special features such as a Guaranteed Annuity Rate?

If the answer to both the above is 'yes', then he needs specialist advice from a regulated adviser if he wishes to transfer to another pension plan.

This OP said that this was a DC pension, so the pension transfer rules don't apply. 

To answer the question that the OP posed "What would be the easiest cheapest way for him to find a suitable, reputable  provider, to which he could transfer?" I would say that the family member shouldn't necessarily be looking for a cheap/easy way, but should be looking for the best way. The best way is a personal recommendation for an Independent Financial Adviser that the recommender has used themselves and been pleased with the outcome. 

If no-one in the family has every used an IFA, then selecting an IFA at random and asking them to provide a long-standing customer that the family member can talk to get a reference from is the next best thing. Clearly they need to be wary of an IFA who is trying to pass of someone they are related to as this long-standing customer, but sensible questions posed to the long-standing customer will usually reveal any such attempt.

The final option is the pre-defined portfolios/retirement funds offered by providers such as AJ Bell and Hargreaves Landsdown.  

Marcon

tacpot12 said:

Marcon said:

Chickereeeee said:

A family member wants to access his pension to take his 25% tax free sum. His current provider does not allow this, so he would have to move  to another provider.

1) The pension pot is moderate/small in size. (He has previously approached IFAs, but they did not seem interested)
2) He knows nothing about investments, and wants somebody to manage it for him
3) I have pointed him towards Pension Wise for now.

What would be the easiest cheapest way for him to find a suitable, reputable  provider, to which he could transfer?

(I manage  my own SIPP, so this is not an area with which I have dealt before.)

Thanks.

Is his pot over £30K?

Does it have any special features such as a Guaranteed Annuity Rate?

If the answer to both the above is 'yes', then he needs specialist advice from a regulated adviser if he wishes to transfer to another pension plan.

This OP said that this was a DC pension, so the pension transfer rules don't apply. 

He needs advice if it's a DC pension with safeguarded benefits such as a GAR and the value is at least £30K, which is why I asked the question about a possible GAR.

See https://adviser.royallondon.com/technical-central/pensions/transfers/safeguarded-benefits/ for more info.

Albermarle

This OP said that this was a DC pension, so the pension transfer rules don't apply. 

As above rules still apply if there are safeguarded benefits. The costs for advice are less than with DB schemes, and platforms are less sensitive about  accepting  transfers, but you still have to go through the process.

LHW99

What does he / she want to happen to the rest (the 75% taxable)

The answer may differ if it is to be drawn down bit by bit / in one lump / preserved to buy an annuity later / preserved to provide a fund for spouse.

Can the company it is with currently offer a newer version that will allow what is wanted?

dunstonh

1) The pension pot is moderate/small in size. (He has previously approached IFAs, but they did not seem interested)

The FCA doesn't like drawdown on small pots unless there are significant other assets or a sufficiently secure income.     

It is also a time consuming process and if the pot is not very large, then it probably isn't viable for the IFA or the investor.  How much is the fund value?   (that will help identify whether that or other options may be better)

DRS1

How old is he?

Chickereeeee

To answer the questions asked:
- No GAR or other special benefits
- I think pot is around £100k+
- Age is 59
- He would like a monthly income, with no need to worry/think about what investments are doing (which I would agree sounds like an annuity, but maybe a bit young to get the best rate?). I think the plan is to continue working while he is able to.
- I have never used or needed an IFA, so cannot recommend one.