Should I transfer my pension, three things to think about - Royal London (2024)

FAQs

Is transferring pensions a good idea? ›

While a transfer value for a final salary scheme might sound like a lot, it might not always be as good as it seems. This is because you might be giving up valuable benefits, such as a guaranteed income for life. It's important to think carefully before moving out of a final salary pension scheme.

We don't charge to transfer your pension savings to another provider. But we may apply an early exit charge to your plan. We'll let you know if this is the case.

Royal London has been named the most recommended and preferred pension provider by advisers, according to Defaqto's pension-service review 2024.

The FSCS will first try to transfer your pension to another provider. If they're unable to do this, you'll get back 90% of the amount you have saved in your pension up to £85,000 per person per institution.

Before transferring you should consider your options – check how well your existing pension scheme is performing, what fees you're paying and whether you have a choice of different investments that suits you. Also, check whether you'll lose any valuable benefits (see more below).

Consolidating your pension could help you take advantage of better investment options. Consolidating could mean getting rid of higher-charging plans. Your administration is easier if you don't have to deal with multiple pension plans.

You could lose all your money and face a tax charge of up to 55% of the amount taken out or transferred plus further charges from your provider.

Our pension and protection teams offer award winning 5-star service, dedicated support teams and useful tools to help you provide the tailored service your clients value.

We'll tell you the name of the person handling your claim and they'll stay with you throughout the process. As soon as we have all the information we've asked for and your claim's been accepted, we make the payment, and funds usually clear in 3-5 working days.

How does Royal London pension work? ›

Your retirement options

If the trustees agree, you can access your pension savings any time after age 55¹ – even if you're still working. And you'll normally have three main ways to enjoy the money you've saved – buy a secure income, dip in when it suits you or take it all as cash.

As a mutual, we're owned by our customers. So when we say we'll put you and your employees at the heart of our business, we really mean it.

Tax free pension allowance

You're entitled to take up to 25% of your total retirement savings tax free. You can take your savings all in one go or as a series of smaller amounts, with 25% of the amount taken being tax free.

The AMC is a yearly fee that we charge to manage your policy and take on a monthly basis. This fee covers the costs of setting up and the ongoing servicing of your policy and the management of your investments. The standard charge for this policy is 0.40% per annum. On certain funds, the AMC may be higher or lower.

How do I opt out of Royal London pensions? Opting out They have one month from their auto enrolment date or enrolment date to opt-out. They must contact the pension provider for the opt-out notice and send the completed notice to the employer.

DB pension transfer values fall by nearly 4% at the start of 2024.

Benefits of transferring a final salary pension:

Improved death benefits. You can leave your entire pension pot to your loved one, free of inheritance tax. You can draw down on your pension pot as and when you like, similar to a bank account. Freedom to invest your pension fund where you want.