Transferring your pension is not an easy decision to make. You may wish to get help from a qualified independent financial adviser.

• what you need to think about when you are making your decision
• the time limits for making your decision
• what happens if you do not make a decision within the time limit.

Here are the warnings but why should people be considering transferring pensions they’ve built up elsewhere? For many people the private pensions they’ll have built up will have been in workplace pensions that are in pots, what LGPS do not make very clear that these pots can be transferred into LGPS to get a pension in the future – “a deferred pension”.

This looks like a good idea if you will secure a decent pension when you retire but telling how much you are likely to get from the LGPS is not easy, it’s a matter of trust that you will be treated fairly. This is what the LGPS member website says about the opportunity open to people in their first year in the pension scheme.

Other pension rights

You may be able to transfer pension rights into the LGPS from:

• a previous employer’s pension scheme
• a self-employed pension plan
• a pension ‘buy-out’ policy
• a personal pension plan
• a stakeholder pension scheme
• an Additional Voluntary Contributions (AVC) arrangement.

I doubt that many people know these different types of pension plan so this is a self-selecting exercise, most members will never get this far and those that do are faced with this statement

The arrangement you transfer from must normally be another UK registered pension scheme. You may be able to transfer in pension benefits from an approved overseas pension scheme. Your pension fund may refuse to accept a transfer from a pension scheme other than the LGPS.

This is not making things easy, there is no reason why people might want to transfer in – yet.

Your previous pension scheme will offer a sum of money called a transfer value. That transfer value would buy an amount of extra pension in the LGPS. Your request to investigate a transfer is not binding until you have seen an estimate of the amount of extra pension the transfer value would buy and confirmed that you want the transfer to go ahead.

It will be very difficult to assess the “amount of extra pension” you will get from LGPS versus the amount of pension you may get in the future from an annuity or the flexibility without any certainty from drawing down from the pot. LGPS know this..

You will need to consider carefully whether to transfer. A transfer may not always be the best decision for you. You should compare the value of the package of benefits you have with your current provider with what you would get in the LGPS. You should consider:

• the estimated amount of extra pension the transfer payment would buy in the LGPS
• when that pension is payable from – your Normal Pension Age
• the other benefits offered by the LGPS – such as early retirement before your Normal Pension Age, ill health benefits and survivor benefits.

All this is going down to trust unless you have a way of working out what is value to you.

You have a year from joining the LGPS to opt to transfer your previous pension unless your employer and pension fund allow you longer. This is a discretion. You can ask your employer and pension fund what their policy is on late transfers.

I am afraid that this “discretion” is bureaucracy, people who join LGPS have a certain 365 days to get this sorted and shouldn’t be relying on bureaucratic friendliness.

If you decide to proceed with the transfer, the extra pension will be added to your pension account in the Scheme year that your pension fund receives the transfer payment.

The amount you get will change if you slip into another Scheme Year, which opens a lot more complexity. So it’s no wonder LGPS end its advice by suggesting you get advice from an independent financial adviser.

Transferring your pension rights is not always an easy decision to make. You may wish to get help from an independent financial adviser.

This feedback is not encouraging? Does anyone have any feedback which concurs or disagrees? I’ve grabbed this off a reply on Bsky – a rather better site than Twitter for accuracy!

If Steber2 is right then there’s something fundamentally wrong going on. The process has to be more reactive to what the market is offering than can be achieved by reviewing once every three years! Imagine if annuities worked like that!

How can you test what the terms from LGPS are? Can anyone help me on henry@agewage.com. This is a hugely read blog for a weekender, I can’t believe others aren’t curious and some knowledgeable!

People won’t get a view from an IFA, they need an actuary to comment on the basis of the rates being offered.

Time for help for people who join LGPS

Most readers will know that I want people who DC pots to get an offer of scheme pensions. There are a few DB pension schemes that still take DC transfers and pay DB pensions. But the LGPS scheme is infact 87 funds (including the Environment fund) in England Wales and more in Scotland and Northern Ireland. This is a huge scheme with nearly £400bn in it. Offering a “transfer in” facility should be a huge feature of the scheme. It should be publicised by the funds to employers who should be advertising it to those joining the pension.

If this is a good deal, or even if it might be, it should be being considered by joiners of LGPS. There are numbers of the people in the Scheme but no information of how many joiners each year and nothing about people using “transfer in”. Here is the facts and figures section of the site.

These issues aren’t getting much of an airing and I’d be interested to hear whether this is on the agenda of the Scheme, the Funds, the Employers or the Members. If you want to contact me – do so on henry@agewage.com or put a comment on this blog.

I will be going to the PLSA LGPS conference this month, I want to know who is interested and who isn’t. I’d like to help because my company – AgeWage – does a lot of work on value for money and wants to produce the kind of information that might help people take decisions about transferring in. But I need to know where to start and for the past two weeks I have yet to find someone to talk to.

I have been an IFA for much of my life and I am as committed as ever to helping people make good decisions with their pots. It looks to me that LGPS may be offering a great pension but who knows? As an IFA I wouldn’t have been able to help as my teaching didn’t include the kind of actuarial calculations are needed to give people answers to the questions they want answering.

Please help me. I am quite sure something that could be done with LGPS that might be done elsewhere. We should be offering DB pensions for DC pots to people who want an obvious way to get themselves paid in retirement.