Thinking about consolidating your old pension pots but worried it could be too complicated? We dispel the top 3 myths about pension transfers.
1. It will take too long
An online pension transfer usually takes just 2-3 weeks. All we need is your pension provider name and your policy number to get your transfer started. Don’t have these to hand? Don’t worry – we can help track them down!
With our in-app Pension Provider Search Tool, all you need to do is share the name of your old employer and the years you worked there and you’ll see your search results of your pension provider – instantly! We have one of the largest databases in the UK with over 20,000 pension providers. In the case we cannot immediately provide the details of your old provider, our team of Pension Detectives will get to work searching for your pension providers and within a few working days, we’ll be in touch with your search results. Once these details are confirmed, we can kick off the transfer and you can also track the progress of your transfer in the Moneybox app.
Choosing an investment fund for your pension is also simple. We offer three investment options, including a socially responsible fund and can all be done from within the app.
2. Transferring my pension will cost too much
The financial regulator has introduced new rules to limit the exit charges providers can make, so it’s unlikely you’ll pay expensive exit fees. There could be other fees associated with transferring your pension, so it’s best to double check this with your provider. If your existing provider is charging a fee to leave/transfer your pension, they should make you aware of this prior to the transfer.
Transferring your pension could save you money. Even if you have to pay a fee to leave in the short-term, it’s worth weighing up how much you could save by paying lower charges over the longer-term- see our pension fee comparison as an example. Remember, the lower the fees you pay on your pension, the more money there will be for your retirement. Make sure you check how much you’re paying with your current pension providers.
It’s important to note that if you have a defined benefit pension, such as a final salary scheme, you shouldn’t make a decision to transfer without getting independent financial advice first. This is because you could lose out on certain benefits as a result of transferring.
3. It’s risky to have my pension with just one provider
It’s often said that you shouldn’t put all your eggs in one basket. But when it comes to pensions, this doesn’t always ring true. Most major pension schemes use large funds that are invested across a range of financial assets from around the world. This is known as diversification and spreads the risk across different assets.
Multiple pension schemes can be difficult to keep track of – having them all in one place can make them easier to manage and you might benefit from lower fees. For peace of mind, your money is guarded at the fund level and protected by the Financial Services Compensation Scheme.
This is what some of our customers had to say about their pension transfer experience with Moneybox:
“It was painless and now I use the app, I can see how my pension is doing, how I want it invested and everything is at the touch of a button. It’s great.” – James
“Moneybox have made organising my pensions so easy and have provided me with friendly service throughout. I’ve been waiting for a service like this for making a boring process, easily manageable.” – Anu
“My experience with Moneybox has been very personal. They always kept me up to date!” – Karen
If transferring your pensions, you should consider the charges and benefits before transferring to Moneybox, and whether the risk and reward profile of the investments offered matches your needs.
Please note Moneybox cannot accept a transfer from a pension your employer is currently paying into or a pension with guaranteed benefits. Remember, you can’t withdraw from your pension until you reach the minimum pension age (currently 55).