Transferring Pensions

Most people switch jobs several times during their working life. However, when you change employers, it is also worth thinking about the pension savings that you have accrued.

You might wish to consider combining your pensions into one pot. It is easier to keep an eye on fund performance if your pensions are all under one umbrella; moreover, a single pension pot will incur less paperwork and administration, and lower costs. This might sound like a no-brainer; however, there are some potential pitfalls to consider before taking the plunge.

It is not usually worth transferring final salary or public-sector pension schemes; the benefits are too good to lose. If your current employer contributes to your existing occupational pension scheme, you should not switch. The money in your pension pot can only be transferred from one pension scheme to another (until you have retired), and not every new pension scheme will accept inward transfers. If your pension pot is very small, it may not be worthwhile switching: you will have to pay charges when you transfer, and some providers impose harsh penalties if you leave their scheme. Finally, if you are already relatively close to retirement, you might not have sufficient time to recover the costs incurred by transferring.

Brian Benson our Managing Director and a Chartered Wealth Manager said, “any decision to transfer a pension pot should be approached with great caution, so take expert advice before making an irreversible decision.”