A SIPP is a type of Defined Contribution (DC) pension scheme giving individuals greater choice of where their pension fund is invested, rather than entrusting their money to one insurance company or fund manager. However, it is not this broad investment choice that makes a SIPP attractive to many, but its relaxed benefit payment rules that were introduced by the UK government in April 2015. In a nutshell, a SIPP can allow members to withdraw their entire fund from age 55.
For some of GBPensions’ clients, such as Keith Bailey* of south Auckland, this transfer route has proved highly beneficial. He says:
I found several companies which said they specialised in UK pension transfers, and was almost on the point of signing up with one of them. But then I looked more closely at their paperwork and the figures involved. They were going to tie me in to their own product for 10 years, and earn a significant amount of commission from my investment. I really wasn’t happy with that. Fortunately, I then found GBPensions.
Tony Chamberlain is the perfect gentleman. He was honest and upfront from the start, and took the time to explain everything thoroughly. It was great to do business with a fellow Brit, because I felt he genuinely understood the challenges we faced as ex-pats in NZ. He was easy to talk to and nothing was too much trouble.
Nobody else was prepared to offer what Tony and GBPensions could. For me, the option of transferring to a SIPP rather than a QROPS was hugely advantageous. And, GBPensions’ costs were so reasonable – I actually felt ripped off by the other companies I’d approached.
In the midst of Mr Bailey’s transfer, the UK voted to leave the EU. It was a decision that shocked many and has caused huge political fall-out, not to mention its effect on Sterling. However, as he observes:
After Brexit, the pound did take a bit of a dive. But that’s okay. We’re holding some of our funds in Sterling, just waiting for the exchange rate to improve. Tony’s already given us the name of a company who’ll assist with the conversion and charge us less than the banks for doing so.
With his pension transfer successfully completed, Mr Bailey concludes:
It is no exaggeration to say that what Tony and GBPensions have achieved for me is life-changing. Thanks to them, we’re homeowners in Auckland and stand a chance of being debt-free too – which is something I hadn’t dreamed would be possible.
Should you think about moving your UK pension to a SIPP?
Mr Bailey’s case study is just one example of how a SIPP can be a genuinely viable alternative to a NZ QROPS. However, there are many factors to be considered before embarking upon a pension transfer, including: