L&G Workplace Pension Transfer

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22nd Feb '21 by lpreidster

8 comments 394 reads

I'm looking for some advice please. I believe this may have been discussed in the past, but I can't seem to find the thread.

I'm looking to transfer my L&G workplace pension to a SIPP (Interactive Investor).

As it is over the threshold of transferring, I am required to seek financial advise.

Can anyone advise if there is a specific company that can be used to facilitate such a transfer - i.e. a fixed fee.

Or would it be a case of contacting a local financial advisor to obtain a quote. (There are a few in my area that I could use, I just wasn't sure of costs associated with the advice).

The pension pot is approx 170K and is making about 2 to 4% per year in the work place pension.

Any advice appreciated.

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Lpreidster

Premium Member

8 comments

Dragon

22nd Feb '21

I transferred and old DB company pension. I was going to transfer it to Youinvest but they insisted that I get a letter from a financial adviser stating I had received financial advice. That was going to cost a minimum £1000 which I thought was a waste of money, as I knew what I was doing. So I contacted iWeb and they just said ok, we will do it no letter needed.

The pot was £60K. I managed to double the pension pot in two years.

Gromley

22nd Feb '21

Hi,

There are a few things to bear in mind :

For the majority of people moving from a Defined Benefit scheme to a SIPP is not a good idea. I don't mean that to be 'preachy' but you really do need to be sure.
Because of #1 (and the potential for IFAs to be sued for advice that doesn't turn out well), IFAs are predisposed to advice against you doing so. The feel I get is that the may be overly biased towards saying no, so you need to be sure you have a very strong case for what you want to do.
My understanding is that the regulations changed recently, such that you have to pay up front for advice. Previously it was possible to seek advice on the basis that fees would only be payable (out of the pension pot) if positive advice to transfer was given and taken. It's not a small amount potentially 1-3% of pot value, although this may have come down as a result of the above.

Personally I used sippclub.com, they are effectively an 'introduction agency' rather than an IFA. Brian at Sippclub is very helpful and to be honest is not a 'pushy sales type', he'll talk you through the pros & cons, likelihood of success and options that might be available even if you get a 'no'. Sippclub get a kick-back from the IFA if you choose to contract with them, so the initial no-obligation advice would be free - this does of course mean they are incentivised for you to go forwards, but as I say I didn't find Brian at all pushy.

I can also recommend reading the lemonfool.co.uk bulletin board which has an active and knowledgeable Retirement investment forum.

I've no personal connection with sippclub or lemonfool, just a satisfied user of both.

HTH

lpreidster

22nd Feb '21

Thanks Gromley for taking the time to reply and for the recommendation with sippclub.com - it's much appreciated. The scheme is DC, not DB. I've enquired and there are no specific benefits associated with the scheme, hence why I'm looking to move it. I have a SIPP set up already and have been happy with the progress it has made so far. (and PS for the record: you're not being "preachy" at all - I much prefer honesty - than someone just telling you what you want to hear! :)

The Phoenix

22nd Feb '21

Hi if its dc you should not be under obligation to see an ifa unless current scheme has something like protected tax free cash, gmp or guaranteed annuity rates linked to it.

Gromley

22nd Feb '21

I agree with clarea on this; if it is Defined Contribution then AFAIK nobody can insist that you take advice. You are just changing your investment manager.

Happy to follow up further if someone does insist you need to take advice, but I don't believe you are obliged to.

lpreidster

22nd Feb '21

Thank you Clarea and Gromley, I will contact them again tomorrow to challenge the requirement for financial advice with a DC scheme. Many thanks for the replies!

The Phoenix

23rd Feb '21

Hi if they insist you still need to have advice let us know the reason why as far as I know unless there is something different from a normal dc scheme such as the features I listed previously you are as far as I understand free to do as you wish.

lpreidster

24th Feb '21

just to let you know, I spoke with them yesterday and they have confirmed I don't need advice and the transfer is now in progress. Thank you very much for taking the time to reply as it could have been costly had I contacted a IFA.

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L&G Workplace Pension Transfer

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Lpreidster

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