Stay in Railway Pension or transfer to SIPP

jamesd · 12 March 2013 at 11:34AM

Don't do it. It's a lousy deal to switch from a guaranteed final salary pension to a highly speculative purchase of property that hasn't been built yet. You might also read the UK government advice in this area.

Switches like this one are typically used by scammers who are disregarding your own best interests to make money for themselves.

classyb · 12 March 2013 at 1:47PM

Have contacted RPI to ensure no transfer takes place they say I am still a member, but have also received a thank you for your reservation from Llana Beach so just waiting to see now. Thanks for all the advice.

le_loup · 12 March 2013 at 2:14PM

Just to reinforce what others have said, read this article from Money Observer:
http://www.moneyobserver.com/issue/features/sipp-scandal-clampdown-pension-wolves

You've had a close shave!

molerat · 12 March 2013 at 2:16PM

I would advise you to write to the railway pension administrator by recorded delivery stating that you do not authorise any transfer of the pension and keep a copy safe. The people you are dealing with are the scum of the earth and may try anything to get hold of your cash.

atush · 12 March 2013 at 2:26PM

Excellent advice.

Babbar · 20 February 2014 at 11:42AM

Hi,

Lets try a balanced view on this thread.

Firstly all investment is risky. Your current pensions rely on Stocks and trade to perform well and if you do your research the performance is dropping. This is a good excuse for the pension companies to say sorry customer you are not getting as much as we hoped as the market has been performing badly, its not our fault (yet they seem to be doing pretty ok in all this).

We should have all heard about the annuity scams recently, this im sure will be the next PPI! Your annuity rate gets a 20% charge, your lump sum payment is taxed, majority of pensions you can not leave to your partner or children.

If we watched the recent Michael Burke program on pensions, it shows that more and more people are turning to property for investment. Why? Because prioperty buys itself and you get the rental income on top.

Advantages of using a SSAS/SIP:- You can take upto 25% of your pension as a lump sum when you turn 55 and pay less tax on it and you dont have to start taking the annuity payments, unlike pensions in this country.

If you die, you can transfer 100% of your pension to your spouse. If they also die then your children will inherit 45%. Again this is unlikely with most personal/work pensions.

Your SSAS/SIP is not solely relying on property, there are other areas your pension can be invested. Commercial property can make sense, as you dont have the headache of having to fill the accomodation yourself and people will always be going on holiday they will never stop, if you look at recent figures, tourism is increasing and so are flights to Cape Verde.

There is a lot more advantages, but I thought I would just offer a flip side to the negative comments on here.

Thanks

dunstonh · 20 February 2014 at 12:13PM

Your current pensions rely on Stocks and trade to perform well

No it doesnt. Its a defined benefit scheme.

We should have all heard about the annuity scams recently

If that is what you think then you havent understood the issue.

this im sure will be the next PPI!

Not even a hint of similarity.

Your annuity rate gets a 20% charge

no it doesnt.

your lump sum payment is taxed

no its not.

majority of pensions you can not leave to your partner or children.

yes you can.

Advantages of using a SSAS/SIP:- You can take upto 25% of your pension as a lump sum when you turn 55 and pay less tax on it and you dont have to start taking the annuity payments, unlike pensions in this country.

More errors

If you die, you can transfer 100% of your pension to your spouse. If they also die then your children will inherit 45%. Again this is unlikely with most personal/work pensions.

You can do that with personal pensions and some works pensions (but not all, such as defined benefit schemes- however, defined benefit schemes are far better value for money).

Your SSAS/SIP is not solely relying on property, there are other areas your pension can be invested. Commercial property can make sense, as you dont have the headache of having to fill the accomodation yourself and people will always be going on holiday they will never stop, if you look at recent figures, tourism is increasing and so are flights to Cape Verde.

single asset, high risk, rife of mis-sales with no consumer protection.....

but I thought I would just offer a flip side to the negative comments on here.

Thank you. However, given the mistakes you have made, it is clear you dont understand the subject and that just gives more validity to the so called negative comments.

Babbar · 20 February 2014 at 1:19PM

So is there no benefit in transferring a pension into a SSAS/SIPP?

atush · 20 February 2014 at 1:22PM

Hi,

Lets try a balanced view on this thread.

No, let's not. You are as fair and balanced as Fox news (ie not)

No one here said SIPPs were bad.

We were saying that transferring a DB pension into a SIPP is a bad idea (even if a good SIPP) but transferring to a Sipp to invest in an unregualted scam is more than unwise, it is criminal.

atush · 20 February 2014 at 1:24PM

Babbar wrote: »

So is there no benefit in transferring a pension into a SSAS/SIPP?

No one said that. They said you should not transfer a FS.DB pension into one in 99.99% of cases, and never into an unregulated investment.

Transferring a Money purchase pension into a SIPP, if you are an experienced investor or will use the expensive bells and whistles of single shares and commercial property Might be a good idea. Or might not, depending on your personal circumstances.

Stay in Railway Pension or transfer to SIPP

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