Pension transfer options
Transferring pensions to a single provider can often make good financial sense – and may make it easier to plan for retirement.
Important information: A SIPP is for those wanting to make their own investment decisions when saving for retirement. As investment values can go down as well as up, the amount you retire with could be worth less than you invested. Usually, you won’t be able to withdraw your money until age 55 (57 from 2028). Before transferring your pension, check if you’ll be charged any exit fees and make sure you don't lose any valuable benefits such as, guaranteed annuity rates, lower protected pension age or matching employer contributions. If you’re unsure about opening a SIPP or transferring your pension(s), please speak to an authorised financial adviser.
What is a pension transfer?
A pension transfer involves moving a pension from one provider to another.
The majority of pension schemes can be transferred. For example, you could transfer your old pension(s) to a personal pension such as a SIPP (self-invested personal pension).
Pension transfer options
If you’ve had more than one job in your lifetime, it’s likely you’re a member of more than one pension scheme. You could consolidate your pensions by transferring them individually into one scheme. This might make it easier to track and manage your finances.
Alternatively, you may simply wish to switch pension providers if you feel you could get a better deal elsewhere.
Reasons to transfer pensions
Transferring your pension(s) could be beneficial for a number of reasons.
- You could make it easier to manage your finances by consolidating your pensions into one scheme.
- Transferring to a new pension scheme might give you greater control over your drawdown income. Many older pension schemes have restrictive rules about accessing your money – such as capped drawdown which limits the amount you can withdraw annually.
- By transferring to a personal pension, such as a SIPP, you could open up more investment options. This would also allow you to manage your own investments. The ii SIPP allows you to choose from more than 40,000 investment UK and global investment options.
- You could reduce the cost of your fees.
For example, while many pensions charge a percentage fee, the ii SIPP charges a low flat fee. Independent research by The Lang Cat has shown this could save you thousands.*
*We've crunched the numbers: If you invested in our SIPP, after 30 years you could be better off by £85k. That's more than £1,000 difference a year, just for using us over another platform. Lots of things can affect your final figure. But the lower the fees, the more money you'll keep for yourself. This is just for illustration if all other factors were the same. Don't just take our word for it: check our working out here.
Things to consider before transferring a pension
Transferring your pension may not always be beneficial. There are a number of factors you should consider before transferring.
Guaranteed /safeguarded benefits
Some schemes offer guarantees and benefits – such as guaranteed annuity rates, the option to take more than 25% tax-free and access to benefits before you reach 55. By transferring to a new scheme, you could lose these benefits.
Employer contributions
Before you transfer from your current workplace pension, check your employer will still contribute as much to your new scheme. You might be better off transferring your old pensions, but keeping your existing workplace pension.
Exit fees
Some schemes charge exit fees. The fee may outweigh the benefits of moving – particularly if you transfer a small pension.
Defined benefit schemes
Defined benefit pension schemes offer a guaranteed annual income in retirement. It is rarely beneficial to transfer out of a defined benefit pension as you will lose a guaranteed income for life.
We recommend speaking to a financial advisor before transferring any kind of pension.
Important information: A SIPP is for those wanting to make their own investment decisions when saving for retirement. As investment values can go down as well as up, the amount you retire with could be worth less than you invested. Usually, you won’t be able to withdraw your money until age 55 (57 from 2028). Before transferring your pension, check if you’ll be charged any exit fees and make sure you don't lose any valuable benefits such as, guaranteed annuity rates, lower protected pension age or matching employer contributions. If you’re unsure about opening a SIPP or transferring your pension(s), please speak to an authorised financial adviser.
What pensions can I transfer to interactive investor?
You can transfer the following types of pension into our SIPP:
- Personal Pension Plans
- Pensions in drawdown
- Other SIPPs
- Some workplace pensions
- Stakeholder Pension Plans
- Frozen pensions
- Retirement Annuity Plans
- Executive Pension Plans (EPPs)
- Occupational Money Purchase Plans
- Small Self-Administered Schemes (SSAS)
- Defined Contribution Pension Schemes
In some cases, we will accept the transfer of defined benefit pensions.
If you wish to transfer a defined benefit pension with a value over £30,000, legally you must seek confirmation from a pension transfer adviser that the transfer will be in your best interests.
We still recommend you seek independent professional advice from a financial advisor before you transfer if the value of your defined benefit pension is less than £30,000.
How long will my transfer take with ii?
If you transfer your pension as a cash payment, it usually takes between 2 – 6 weeks to complete. For cash transfers, you must sell your existing stocks before transferring.
If you’d like to keep your existing investments, the transfer will take longer. It usually takes 8 – 12 weeks but it depends on the type of investments you hold.
The length of time the transfer takes will also be reliant on how quickly your current provider works with us to complete it.
If you are transferring a defined benefit pension or a Small Self-Administered Scheme (SSAS), the timeframes shown are not representative. For these schemes, transfers may take considerably longer.
Tracking and transferring lost pensions
If you need help finding a lost pension, visit the government’s pension tracing website . It will help you find the contact details of a lost pension scheme.
What are pension transfer charges?
Some providers charge a fee to transfer your pension and these fees can vary.
At ii we do not charge either transfer or exit fees. However, your existing provider may, so it is important to check before you transfer.
Pension transfer FAQs
Important information: A SIPP is for those wanting to make their own investment decisions when saving for retirement. As investment values can go down as well as up, the amount you retire with could be worth less than you invested. Usually, you won’t be able to withdraw your money until age 55 (57 from 2028). Before transferring your pension, check if you’ll be charged any exit fees and make sure you don't lose any valuable benefits such as, guaranteed annuity rates, lower protected pension age or matching employer contributions. If you’re unsure about opening a SIPP or transferring your pension(s), please speak to an authorised financial adviser.