Pension transfer refers to the process of moving your existing pension fund from where it is currently invested to a new pension arrangement.
For those in group employer pension schemes, pension transfers arise from a career move to a new company, or the closure of their existing pension scheme.
Otherwise for those with Private Pension Plans, in the form of a Personal Pension, Executive Pension, Personal Retirement Saving Account (PRSA), or Personal Retirement Bond (PRB), this is usually prompted by the need to get lower and more transparent charges, with more investment choice.
In all cases, certain pension transfer rules apply in Ireland, in terms of what type of pensions can be transferred from one pension arrangement to another. Pension plan charges and investment fund choice can also vary considerably, so it’s hugely important to take the time to ensure that you get the best advice, before undertaking any kind of pension transfer.
Before you even start speaking with any financial advisor, make sure to investigate online or ask them about their professional Pension and Investment qualifications.
Pension Transfer Rules
The transfer rules depend on the arrangement you are transferring from and the arrangement to which you are transferring.
- Occupational Pension Scheme benefits can be transferred to a PRB, PRSA, Executive Pension Plan, or to another Employer Group Scheme.
- Executive Pension Plan benefits can be transferred to another EPP or a PRSA.
- Personal Pension Plan benefits also known as retirement annuity contracts, can be transferred to the same type of arrangement or a PRSA.
- Personal Retirement Savings Account benefits can be transferred to another PRSA.
Pension Transfer Advice
We have authored an additional article to assist you in exiting your employer’s pension scheme.
However, if it is the case, that you are seeking fully transparent charges, a broader investment choice, a better overall service, or indeed a combination of all 3 then, what’s key is choosing the right advisor.
- Before you even start speaking to one, make sure to investigate or ask them directly about their professional qualifications in the pensions and investment space.
- Although it may sound obvious, ensure that they can provide impartial advice, in that they hold agencies with a broad selection of pension plan providers.
- Not all pension transfer solutions are equal, you may find a well-qualified and experienced financial broker offering you the right provider solution, with the funds set to suit your circumstances, but the charges are excessive.
Pension Transfer Solution Charges
Seeking real value is imperative when conducting a pension transfer of any kind, and where you are getting all the detail, with a lack of transparency on charges be concerned.
As with all pension plan types, the underlying charges will eat into your investment growth, diminishing your eventual pension pot come retirement.
Pension advisors can manipulate pension plan charges, to pay them more in 2 ways:
- By not granting 100% investment allocation on the transfer.
- By adding their excess charges, to the underlying annual investment management charge.
Pension Transfer Personal Review
If you are interested in finding out more about transferring your pension, contact us for a no-obligation free consultation today.