Make life simpler with a Retirement Account - an award winning personal pension from our retirement partners at Scottish Widows.
3 things to understand before transferring your pension
Before you decide to transfer, it’s worth checking if you’re eligible. The main things Scottish Widows check when you ask to transfer are:
- The pension(s) you wish to transfer have a total value of more than £10,000
- You live in the UK
- You’re under the age of 74
- You’re moving pensions which are with a UK-based provider
- You plan to move a whole pension, not part of one
- You aren’t already taking an income from the pension you’re moving, and you haven’t taken a tax-free lump sum from the pension being transferred either.
We can’t give you an illustration if your planned retirement age is less than a year from now. You can call us on 0345 601 2585 Monday-Friday 9am-5pm to discuss your retirement options. Calls may be monitored and recorded. Calls cost may vary depending on your service provider.
If you have a pension which was set up by your employer, it might be managed by trustees. If so, you will need to get permission from the trustees before you transfer. If you’re not sure if your pension is run by trustees, check your policy or scheme documents, or contact your scheme administrator.
Scottish Widows can accept transfers from most, but not all, pensions. Here is a list of the main types of transfers they can’t accept online:
Pensions with guarantees- A Guaranteed Annuity Rate: this means, in most cases, you’ll get a higher income for life when you retire than you’d get at today’s rates.
Section 9(2B) rights or a Guaranteed Minimum Pension: these would provide you with an income that’s based on what you earned at the time this pension was set up.
Pensions with defined benefits - Known as final salary or defined benefits pensions where how much you receive is based on your salary rather than how much you’ve paid in.
Payments - If you or your employer are still paying into the pension you’re transferring and this is going to continue to happen or you are already taking an income from the pension.
Other reasons - Your pension is with a provider outside the UK, it’s subject to a court order, for example when it’s been divided as part of a divorce.
Finally, you can only transfer the entire pension, you’re not able to transfer part of a pension.
You can find out about these in your policy documents or you might have to speak to your current provider. If you don’t know what to ask here’s a helpful checklist.
Download the letter (DOC, 39KB)
Some of your existing pensions’ benefits and features might be valuable or you think they’re worth keeping. If you transfer you’ll give these up, so, it’s worth checking before you apply.
These can include:
Protected Tax-Free Lump Sum – You can normally take up to 25% of your pension as a tax-free lump sum at the point where you start to withdraw from your pension. Some pensions allow you to take more than this which could be of benefit to you.
Protected Pension Age - this enables you to access your pension benefits before the Normal Minimum Pension Age (NMPA), with the latter rising from age 55 to 57 in 2028. If you were born after 5 April 1971 this may affect you, but you might be able to take your pension benefits before the NMPA with this protection. You should always check whether your existing pension(s) have this, as these might be affected if you transfer.
Fund guarantees or bonuses - These can include a guaranteed growth or bonus rate, a loyalty bonus or a fund bonus.
Protection - This can include life cover, critical illness cover or waiver of premium.
Be aware some pensions will charge an exit fee if you choose to transfer. Make sure you know if there is one and how much it will be before you proceed.
You can find out if your pension has any of these by looking at your policy documents, or you might have to speak to your current provider. If you don’t know what to ask here’s a handy checklist.
Download the letter (DOC, 39KB)
If you are a member of a workplace pension scheme(s), you should consider whether it is possible to transfer to that scheme. These schemes may benefit from lower charges relative to individual pension plans, however they may not be as flexible when it comes to investment choices or taking your benefits so it’s worth checking all of these points.
Before you decide to transfer, you might need advice or guidance.
What is Guidance?
When you read our website or speak to Scottish Widows, you’ll get what’s known as guidance. They’ll answer any questions you might have about pension transfers so you can make an informed choice. But this isn't the same thing as advice, as we won’t recommend what you should do next.
Take a look at their help and support page
If you plan to take money from your pension soon after you transfer to us, this is an important decision.
You could get free and impartial guidance about your pension options from Pension Wise from Moneyhelper. It’s a government service that offers clear and simple guidance online or over the phone. Find out more about Pension Wise, by visiting the MoneyHelper website.
What is financial advice?
This is what you’d get from a Financial Adviser. They’ll talk to you about what your finances look like today, and your plans for tomorrow and recommend the best products to suit your personal situation. They’ll normally charge you for their advice.
Find out more here or you can learn more about how to find an adviser on Scottish Widows website.
If you plan to take money from your pension soon after you transfer to, we’ll ask at the start of our application form if you’ve had financial advice or Pension Wise guidance, or if you would like some before proceeding.
Competitive, clear and transparent charges - before deciding to transfer you should always compare the charges you’ll pay with your current provider versus the provider you are looking to transfer your pension to.
Scottish Widows’ charges – these cover the cost of managing your investments, managing your pension, admin and fund trading costs. We won’t charge you for transferring in or setting up your pension, although you should check if your existing provider may charge you to transfer out.
How it works - The more you have in your pension pot, the lower the overall charge rate. Currently the maximum you’ll pay for investing in a Governed Investment Strategy (GIS) is 1.1%, however, most people won’t pay more than 1.0% a year.
The overall charges are broken down into two, so you always have a clear picture of the costs:
1. Service charge - an annual charge of 0.1–0.9% a year that decreases as the value of your pension increases. This is based on the total value of the Retirement Account:
- £0k - <£30k = 0.90%
- £30k - <£50k = 0.40%
- £50k - <£250k = 0.30%
- £250k - <£500k = 0.25%
- £500k - <£1m = 0.20%
- £1m and over = 0.10%
2. Investment management charge - When you transfer you’ll be invested in a GIS (you can find out more about this on the Investment Options page). The investment charge will in most instances be 0.1% a year. If you transfer to a different fund in the future this figure could change.
These are current rates that apply for new Retirement Account applications. We may change these rates or make new charges in the future.
Example of how these charges could look
Example of how these charges could look
If you have £40,000 invested in a Governed Investment Strategy, every year we would charge you:
Service charge 0.4% : £160
Investment charge 0.1%: £40
We would collect this by taking just under £17 out of your Retirement Account each month.
You could have forgotten about a pension you already have and it could make a difference to how much you save for retirement.
If you can remember who the pension provider is, try giving them a call to see if they can help. Or, if it’s a company pension, call your previous employer for the details.
Alternatively, go to The Pension Tracing Service operated by the Department for Work and Pensions.
If you’ve already reviewed and decided transferring is right for you and read about your investment and retirement options you can start the application. You’ll need the following:
- Your National Insurance number
- Your existing pension providers name
- The policy numbers of each pension you want to transfer
- The Scheme name if it’s a workplace pension
- A recent transfer value for each pension
- You know how you want to invest and access your new pension
- A minimum of £10,000 to transfer from either one or multiple pensions
Important legal information
Lloyds Bank plc. Registered office: 25 Gresham Street, London EC2V 7HN. Registered in England and Wales No. 2065. Lloyds Bank plc is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority under registration number 119278.
Eligible investments with us are protected by the Financial Services Compensation Scheme (FSCS). We are covered by the Financial Ombudsman Service (FOS).