+ Larger Font | + Smaller FontCan I transfer my existing pensions into my SIPP?
The major advantage of a SIPP is that they offer far greater flexibility as well as more beneficial tax benefits and possible lower costs than most traditional pension plans on the market. Recent changes in legislation mean that SIPPS are no longer aimed at those on a higher income and can additionally be managed alongside a more traditional pension plan.
When originally introduced into the market SIPPS were marketed at those with pension funds over GBP200K, however in recent years changes have allowed even those with no regular source of income to contribute up to GBP3.6K a year. SIPPS are more beneficial to those who have an array of different pension schemes and want to consolidate these plans, plus any other investments they may hold, into one easier to manage pension wrapper. A SIPP may also be appropriate if you are self-employed or if you’re current employer does not offer a suitable pension scheme.
SIPPS can also be of great benefit for those looking for more freedom to invest in a wider array of investment options, greater flexibility on when you are able to start drawing down on your pension and how you choose to receive the income generated. SIPPS also offer a wider range of pension benefits for your dependants when you die.
You are also able to withdraw 25% income tax free lump sum with the remaining funds available to purchase an annuity. Income draw down is usually only suitable if you have existing assets to provide income or if you have a pension value greater than GBP100K. Any of the remaining funds that you don’t use to withdraw benefits continues to be invested anyway you wish, however it can provide uncertainty for future returns.
As with any investment advice we would strongly urge a consultation session with an independent advisor before making any decisions.
Frozen Pension Review Service:
Please take advantage of a free, no obligation review with one of our recommended, independent pension advisers. During which they can discuss some of the various options open to you.
