Some of your existing pensions’ benefits and features might be valuable or you think they’re worth keeping. If you transfer you’ll give these up, so, it’s worth checking before you apply.
These can include:
Protected Tax-Free Lump Sum – You can normally take up to 25% of your pension as a tax-free lump sum at the point where you start to withdraw from your pension. Some pensions allow you to take more than this which could be of benefit to you.
Protected Pension Age - this enables you to access your pension benefits before the Normal Minimum Pension Age (NMPA), with the latter rising from age 55 to 57 in 2028. If you were born after 5 April 1971 this may affect you, but you might be able to take your pension benefits before the NMPA with this protection. You should always check whether your existing pension(s) have this, as these might be affected if you transfer.
Fund guarantees or bonuses - These can include a guaranteed growth or bonus rate, a loyalty bonus or a fund bonus.
Protection - This can include life cover, critical illness cover or waiver of premium.
Be aware some pensions will charge an exit fee if you choose to transfer. Make sure you know if there is one and how much it will be before you proceed.
You can find out if your pension has any of these by looking at your policy documents, or you might have to speak to your current provider. If you don’t know what to ask here’s a handy checklist.
Download the letter (DOC, 39KB)
If you are a member of a workplace pension scheme(s), you should consider whether it is possible to transfer to that scheme. These schemes may benefit from lower charges relative to individual pension plans, however they may not be as flexible when it comes to investment choices or taking your benefits so it’s worth checking all of these points.