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Your UK Pension Lump Sum – Could you be sitting on a goldmine?

Your UK Pension Lump Sum – Could you be sitting on a goldmine?

As people move from job-to-job over their working lives, they are likely to accumulate several  super funds, which now given that they are less likely to be eaten up by insurance premiums, could potentially add up to a fairly significant income stream in retirement. While many struggle to locate, consolidate and take advantage of these funds, those who emigrate from the UK to Australia often leave them behind entirely. If this sounds like you, you could be missing out on a potential gold mine without even realising it. What’s more, some company pension schemes are currently offering attractive incentives for people to withdraw their pensions as a lump sum or transfer the benefit to an alternative arrangement. Read on to find out what the details are, and how you may be able to get the most out of your UK Pension.

Why are lump sums available?

Due to the current low interest rates in the UK, it costs a pension scheme that offers a guaranteed pension in retirement (often referred to as a final salary scheme) potentially more in the long run to pay a person’s pension in instalments, as people continue to live longer.

Many of these pension schemes have come to the conclusion that they can be better off in the long run by paying out a generous transfer value to their members and extinguishing their long term future liability to pay pensions. In many circumstances there can be significant benefit in forgoing the pension income in return for the transfer value on offer, as it can offer greater financial flexibility and potentially more income in retirement, particularly if you intend to remain and retire in Australia.

How do you get hold of your UK pensions?

Getting the exact figures from your scheme may not be as easy as simply looking at your last pension statement, particularly as each scheme has a different method of calculation for the transfer value. Pension Transfer Specialists can assist you with obtaining your statements from each of your previous jobs, contact your scheme directly and enquire about the transfer value for each.

What next?

Considering whether to transfer your UK pension benefits to Australia and whether to swap a UK pension income for a lump sum transfer value is not a straight forward decision. It is important that appropriate consideration is given to your over financial position and needs in retirement.

Further, the physical transfer of pension funds from the UK to Australia is fraught with complexity and can be a drawn out process, therefore undertaking a proper and considered appraisal of your options is essential. By talking to a financial planner that specialises in UK pensions they will help you to understand what your UK pension entitlements are and consider your options and what will be most suitable for you.

To talk to the Pension Transfer Specialists, go to https://www.ptspecialists.com.au/

McKinley Plowman

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