What is the process for transferring a pension?

J Finance Transferring a pension

There are many good reasons why you might want to consider transferring your pension…

…a new pension scheme with a new employer; consolidation of several existing pensions into one pot; or perhaps the terms of your existing pension scheme are changing and you’ve found a scheme that will be more profitable for you.

Either way, there are also a number of things that you will need to consider. Take a look at our web page for information on the things that you will want to consider.

There are four steps to the pension transfer process:

  1. Assessment – Before making any recommendations, we seek to fully understand your pension requirements. We appreciate, that transferring your final salary pension is not an easy decision to make. That’s why we have professionals who offer honest recommendations that are in your best interests, and not ours.
  2. Decision – After a conversation with one of our professionals, we can then assess your circumstances. Our Pension Transfer Specialists will gather all the necessary details from you and turn our attention to analysing this information. Factors such as your income in retirement, health, lifestyle, age, marital status, life expectancy and retirement date are all considered in this stage.
  3. Recommendation – All our recommendations are explained in a language that’s designed to be understood. You will receive an individual suitability report disclosing our recommendations. If you have any questions, our Pension Transfer Specialists are available to give you peace of mind.
  4. Transfer – It is then up to you if you would want to progress with our recommended transfer. We can take care of the process and the paperwork.

A real life example

Please note that the below is based on individual circumstances and may not apply in every case.

£18,000 a year on retirement, or £448,000 today?

Sandra is 49 and lives in Lancashire. She is married to Geoff who is 48 and they both want to retire at 65. Their goal is flexibility in retirement and Sandra wants to ensure that if something happens to them, their daughter who is at university will inherit their full pension amount. Sandra’s transfer value is £448,000.

At 65 Sandra will receive a pension salary of £18,000 from her scheme, however Sandra wants to take a 25% tax free lump sum at age 55. Sandra does not want to draw from her pension as she wants to continue working, something her scheme will not allow as she cannot take a lump sum without retiring early.

If Sandra passes away within her scheme, her husband will receive £5,800 per year. However, if Sandra had chosen to transfer, her husband would receive £448,000, if Sandra had not started drawing from her pension, which could provide £22,000 a year.

If you would like to discuss your pension and possible pension transfer, we will be happy to help. Please contact us without obligation.

 

Established in Berkshire in 2001, J Finance Ltd is one of the leading financial planning companies in the area. We serve clients across the South of England including Oxfordshire, Buckinghamshire and Hampshire. If you would like to discuss this subject or any other financial matter, please contact us on 01635 521 300 or email contact@jfinance.co.uk.