Choosing pension adviser
Before getting pension advice, it’s important to check whether they’re a ‘whole of market’ adviser or a ‘restricted’ adviser.
If an adviser is restricted, it means they will only look at a panel of pension providers and funds, or sometimes will just recommend one provider or pension, which can sometimes be their own products.
Whole of market means your adviser will review all the pension providers and pension funds in the market before making a recommendation.
Understanding how much you'll pay
Before signing up for pension transfer advice, make sure you’re fully aware of the costs involved.
Because it’s a pension transfer, the cost of the advice will be deducted from the pension itself meaning you won’t have to find the money from your own pocket.
Pricing varies between advisers. Some advisers will charge an up-front free, whilst others will only charge you upon the transfer of your pension.
Typically, the advice is charged as a percentage of your pot, but less commonly it will be a fixed fee or hourly rate. A lot of advisers will have a minimum pot size they will look at or a minimum fee they will take, so it’s important to look out for this.
At Profile Pensions, for example, there’s no up-front cost, no minimum fees or pot sizes we review, and you’ll only pay if you decide to transfer your pension. We look at the whole of the market and won’t recommend you transfer unless we find that you’d definitely be better off moving your pension. You can find out more about our fees here.
Tracking down your pensions
When you seek pension transfer advice, the first step will be to locate all your pensions. You’ll therefore need to dig out any paperwork which shows the name of your pension provider and/ or your policy number.
If you’re not sure whether you’re missing any pensions, or you’ve got multiple pots and are worried you’ve lost track of one or more of them, an adviser can help find them for you.
It’s not uncommon to have lost track of a pension, particularly if you contracted out of SERPS in the 80’s and 90’s. If you think you contracted out of SERPS and have a missing pension, sign up today for no up-front cost. Or we can do it for you, following these instructions to find lost SERPS pensions.
Conducting a full pension review
Once all your pensions have been located, your adviser will conduct a detailed review of your retirement savings, looking at where your money is currently invested, how much you’re paying in charges, and the options available to you.
They’ll also want to find out what sort of retirement income you’re hoping to achieve and whether there might be any benefits which you could lose if you transfer away from your current provider.
For example, if you have a defined benefit or final salary pension, the amount you’ll receive at retirement is guaranteed and will increase each year so that it keeps pace with rising living costs. This means you’ll usually receive a much better retirement income than you can from other types of pension.
At Profile Pensions, we don’t offer advice on final salary schemes.
Transferring your pensions
If your adviser is whole of market, they’ll look at all pensions to make sure you get access to the best one available for your needs.
They’ll first want to be satisfied that any pension they transfer you to has a strong performance record, is 100% regulated, and has low costs.
They’ll also make sure where your pension is invested matches your approach to risk. So, for example, they won’t take a very adventurous approach if you’re a cautious investor and uncomfortable with a high level of risk.
You’ll be told exactly how much it will cost you to move your pension to a different provider.
If you decide to proceed, you must give your permission either verbally or in writing for your adviser to make the transfer. Moving your pension will usually take an average of four weeks, although it may take a longer or shorter time depending on which pension provider you’re transferring your pension to.
Remember, if you’ve chosen to receive advice from a company which offers no obligation pension transfer advice, there’s no commitment to follow the advice you receive, so if you decide not to transfer after all, you can walk away without having to pay anything.
Find out more about Profile Pensions approach to advice here .