1. Can I transfer my pension?
There might be restrictions on your transfer options so it’s worth finding out from your current provider what type of pension you have. The main types are defined contribution (DC) or defined benefit (DB) pensions.
Defined Contribution Pension Transfer
Your contributions (and any employer contributions or contributions made on your behalf by someone else) are invested to build up your pension savings, and you choose how and when you want to use your savings. The amount in your pension at retirement is based on how much has been paid in and how well the investments have performed.
You can transfer most types of DC pensions but if you have any benefits or features attached to your plan you may lose these if you decide to transfer.
If your DC pension is worth more than £30,000 and has a guarantee about how much you'll be paid when you retire, you must get financial advice before you make a pension transfer. Royal London will not accept transfers from defined contribution plans with guarantees, if you have not received advice.
Defined Benefit (e.g. Final Salary) Pension Transfer
With this type of pension your benefits are calculated using length of employment and salary. DB pensions provide a valuable guaranteed retirement income and often have other special benefits.
If you want to transfer a DB pension to a DC pension you will lose access to your guaranteed benefits from your DB scheme.
If you're thinking of transferring a DB pension to a DC pension and the value of your pension benefits is more than £30,000, you must get advice from a financial adviser. In most circ*mstances it is not advisable to transfer a Defined Benefit pension to a Defined Contribution pension. Royal London will not accept defined benefit transfers if you have not received advice.
2. Should I transfer my pension?
There are pros and cons to apension transfer. It’s important to make sure you have all the information you need, and take some time to make a decision that’s right for you. You should read our Pension Transfer Guide before making any decision. Below are just some of the things you should think about before transferring.
There’s no guarantee that transferring or combining your pensions will give a higher income or bigger pension pot when you retire. Your pension is invested so its value can go down as well as up and you could get back less than you put in to your plan.
3. Should I speak to a financial adviser?
An adviser can look at your overall finances to help:
- Understand your needs
- Discuss potential solutions
- Draw up a short list of options and providers
- Highlight the pros and cons
- Explain the process involved in combining your pension
- Make a recommendation.
Advisers may charge for their services – though they should agree any fees with you upfront.
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Decide for yourself
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Find a financial adviser
It’s important to consider all the pros and cons and make sure a pension transfer is right for you.
If you are considering transferring to Royal London, our Pension Transfer Guide (PDF) can help you understand what a pension transfer might mean for you to help you make an informed decision.
Find out about transfers, if you’re eligible and how to go about it now.
There are some situations where you must get financial advice before making apension transfer. If your pension is worth £30,000 or more and you’re not sure if transferring is right for you, we recommend you speak to a financial adviser before making a decision.
In fact, we’ll always ask you to get advice if you’re thinking about transferring from a defined benefit pension.