Pension Transfer considerations

Once you have completed your pension review you may consider acting on it by doing a pension transfer.


Pension transfer

Bristol Pension Review - pension transferA pension transfer is where you transfer smaller pension pots into one collective new one.

The reason for a pension transfer are varied. Sometimes this is because you have had different employers and your work history has ended up providing you with multiple small pension pots because you have joined different company pension schemes with each employer.

If you do a pension transfer in this way the advantage is that you reduce the fees that you pay for the management of each small pension pot.
This pension consolidation works in 2 ways because the larger pension fund attracts lower charges and fees if the amount of the pension pot is bigger.

Hidden Pension Commissions

A pension transfer is also a very good way of reducing pension commissions. Lots of smaller pensions may well have commissions that are still being paid from your previous advisor. This commission reduces the value of your pension as it comes from your pension.
By initiating a pension transfer you effectively cut the trail back to the advisors.
Another reason why you may want to consider a pension transfer is that sometimes your style of living changes as children leave home or you retire from work. In this case you may well retain your pension provider. But choose a different pension fund.
If you take a look at the pensions available you may want to switch pension fund to one of the many on offer as you approach retirement.
This might involve transferring out of equities into cash or fixed interest investments.
Pension performance