I took a look at this scorpion and decided enough was enough, I told myself…
I’m going to liberate my personal pensions and section 32 policies from high charges, poor fund management and non-existent governance into my new plan which has low charges, good governance and excellent investments.
Here is how it’s gone so far….
In October I decided to get my act together and review my pension plans. I have eight private arrangements. I have an occupational DB plan that’s staying put and it has money purchase AVCs with guaranteed annuity rates – these are going nowhere.
I had benefits under a former employers occupational plan which under investigation now turn out to be in a section 32 policy with an insurer.
I have two 226 policy with negligible transfer values that barely match contributions paid between 1985 and 1988.
I have two personal pensions (one for contracting out) and a stakeholder pension.
I investigated the plans. I checked the charges, the transfer values, the funds and the governance – with the exception of the section 32, all were shocking. I decided to transfer all thse pension plans into my latest employer funded GPP and requested the paperwork.
Having completed all the forms for both ceding and receiving schemes for the six transferring schemes , I sat back and waited ……and waited ….and waited.
At the point of writing (nearly three months later) one out of five transfers has completed. The other five transfers are stuck in the pipeline.
I had sent details of my fund holdings from my current providers to my new scheme but that is not enough, it turns out I have to give them “benefit statements” as well. Well the benefit statements (which are produced at scheme anniversary) are not in my possession and that is because I have moved house several times over the years and the statements are in someone else’s wastepaper bin!
Today I contacted the customer service team at the receiving scheme and asked them to use the letters of authority I’d sent them to contact the ceding schemes to get copies of these statements.
This exchange followed.
Provider “I’m sorry sir, we cannot act on your instructions”
Me; “But I am the customer”
Provider; “That is irrelevant”
To cut a long story short, if I was an adviser there would be no problem but as a customer I am irrelevant.
Personal Pensions were set up to be portable, you are supposed to transfer them from provider to provider without cost and without hassle. That’s what it said on the packet. The reality is that it is now nearly as hard to convince a personal pension provider to accept a transfer value from another personal pension provider as it is from a defined benefit scheme.
The sums involved (to me) are significant, they represent a large proportion of my savings. But I have no control of my money and am treated as a financial self-harmer!
Incidentally the only transfer that has gone through was so ineffeciently processed that I was “out of the market” for nine days (at a cost to me of £2,250 in lost investment returns – so much for electronic trading).
The obvious option is to hand over everything to an IFA and pay a hefty sum to get them to do the administration for me. Whether they’d get the same obstacles as I have I do not know but presumably they’d be consider relevant.
But that’s not the point. I object to paying someone to do something on my behalf that I’m qualified to do myself, (I have the advanced financial planning certificate in a cupboard somewhere!)
If it is as difficult as this for me, what must it be like for others?
For all of the talk of pot following members, my experience suggests that there are such headwinds against the member transferring personal pension pots that the term “personal” should be struck off by trade descriptions. These pots belong to the advisers for whom they are a source of trail commission , to the fund managers who have carte blanche to deduct what they like from the Net Asset Value of my units and to the providers who consider my status as customer “irrelevant”.
Mr Webb, before we get ahead of ourselves in requiring automated transfers in the future, can we do something about easing the gridlock of the past?
It strikes me that I’m a victim of “pension captivity” fraud