Pension charging structures have changed dramatically over the past few years. Due to the influence of stakeholder pensions the cost of a new pension is now far lower than in the past. Many individuals now find themselves with outdated, overpriced pension contracts. In some cases you may even be able to switch contracts with the same provider to better your charging structure.

No charge other than the Annual Management Charge

Whilst you can transfer into any UK stakeholder pension with no initial charge, there are still a number of factors that need to be considered. If you are considering transferring your pension away from your current provider, the main factors you have to consider, is the possible benefits of transferring your pension against the associated costs of moving, including any penalties you may incur by your existing provider.

The further away you are from retirement, the more likely the benefits will outweigh the costs of the transfer, as time will dilute any initial costs and penalties associated with transferring.

The easiest way to make a charge comparison is to ask your provider for a current Valuation and Transfer Value of your pension, this will enable you to see what the costs are in moving away from your current provider. In addition by asking your insurance company to provide a projection to your chosen retirement age, you can make a comparison with a newer charged contract. This will assist you in making a decision as to whether a transfer is the best thing to do.

We have attempted to highlight the main factors that could influence whether or not transferring to another provider is the right thing to do, there may be other reasons as to whether this is a suitable product to transfer to and if you are in any doubt you should seek independent financial advice.