Royal london transfer value.

[roadrunner bill]

I have a pension with royal london, not much in it..

My statement says its transfer value is 10 k.

I want to cash it all in when I'm 55.

Can someone please tell me. Is the transfer value the same as cash it all , as a lump sum..

So when I ask for all of it as a cash lump it will be 10 k ?

Thank you.

[RobertT]

It sounds like a defined contribution scheme?
In which case it's a pot of cash and worth what ever it's worth at the time. That will be the case if you transfer it or cash it all in.

Not all DC pensions allow all flexibilities, so you may sometimes have to transfer out to do what you want. Generally that applies to older schemes, but will be specific to your product.

Either way, you will be able to withdraw all of it, but usual pension rules will apply. So 25% will be tax free and the remainder treated as income and taxed accordingly.

More info: https://www.moneyhelper.org.uk/en/pensi ... -in-one-go

[roadrunner bill]

Thank you robert for your fast reply, very much appreciated for your info..

My statement says its something to do with surps from years ago..

[RobertT]

SERPS – State Earnings Related Pension Scheme, sometimes known as additional state pension or state second pension.
It ran between 1978 and 2016.

At some point you will have been contracted out of SERPS via a previous employer, which meant paying a lower rate of NIC's.
In return for that, the NIC's you and often your employer would have paid were invested in a personal pension instead.

The idea was that you would build up at least as much, if not more via your contracted out scheme than you would have accrued via SERPS.

Contracting out can sometimes lower how much total state pension you receive, although the more you accrue after 2016, the less you're likely to be affected by that.

*Defined benefit schemes often contracted out too - RM's did up to 2016.

SERPS info: https://www.unbiased.co.uk/discover/pen ... ps-pension

[roadrunner bill]

Thank you,..i joined royal 1991

The start date for this was 1987. And formerly contracted out of serps/s2p..

So I'm assuming that it stopped as soon as I joined royal mail.

[roadrunner bill]

Thank you,..i joined royal 1991

The start date for this was 1987. And formerly contracted out of serps/s2p..

So I'm assuming that it stopped as soon as I joined royal mail.

I did phone royal london and they said I can all of it as a one off lump sum. 25% tax free the rest taxed. So I'm guessing as I'm not educated on this thing, I'd get about 8 k from a 10 k pot..

[RobertT]

Yes, the Royal London pension will have stopped when you left that job. But it will have continued to grow over the last 30 odd years.

Assuming you're a basic rate taxpayer(income less than £50,270), you'll lose 20%, so your figures are correct.

[roadrunner bill]

Thank you .