Transfer to Stakeholder

edited 30 November -1 at 1:00AM in Pensions, Annuities & Retirement Planning
2 replies 717 views
m0rkm0rk Forumite
2 Posts
I opted out many years ago and had a small personal pension running for about 5 years - change of jobs, circumstances left me freezing that pension, ive never looked at it since until today.

My current company do not provide a pension any more (used to have a very good final salary pension but us new employees are no longer alowed to join) and we have a stakeholder pension opened for us which we choose to contribute to or not.

Currently, my first personal pension is with Friends Provident and as of 9 April 2005 had a transfer value of £11888.54 (£485.03 less than the Total value) and im wondering if I should leave it where it is or transfer it into the stakeholder scheme. The current info on the Stakeholder is it is with B&CE - there is no charge on it until 2006 at which point it is looking likely to be approx 0.65% per year.

So, im currently about to start paying into the stakeholder pension, but should I transfer the previous one into it - both B&CE and Friends Provident say there are no charges from their side although as above there is a drop in the value of the fund if transferring. The current fund doesnt seem to have a name, just personal pension plan - it has non protected and protected rights whatever they are!

Either way i'll be actively paying into the stakeholder from now.

Replies

  • dunstonhdunstonh Forumite
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    The B&CE scheme has quite low charges although IIRC, the fund range is not extensive.

    Also, I believe that they wont take protected rights benefits so if you FP pension does contain contracted out payments, your options may be limited. I have no absolute proof myself that they do not but a few weeks back another advisor on a Pearl PPP transfer, the B&CE only accepted the ordinary rights and refused to take the protected rights.

    As to whether its worth you moving the pension from FP to B&CE, and assuming its possible, you would need to compare the projections from the B&CE scheme on the transfer value against the projection from FP on the current value. Whichever is higher at the same growth rate is the cheapest. FP themselves have a respectable fund range.

    So:
    1 - it may or may not be worth transferring based on charges. You would need a projection from FP and illustration from B&CE to confirm
    2 - Fund selection would need to be compared and make sure the portfolio of funds you want is available with both (the days of investing in one fund are long gone thank goodness).
    3 - Check B&CE will accept your protected rights (protected rights is the contracted out bit).
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • m0rkm0rk Forumite
    2 Posts
    ok ... after having a chat with our office manager ... it now turns out there is another pension option - they're not good with communications!, the stakeholder scheme is open to all, the final salary scheme is now closed to new comers but apparantly there is an in between pension that is somewhere between the stakeholder and final salary. I have recently passed the length of service to be valid for it so after further enquiries should be getting an invite with the actual details so heres hoping ..... !
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