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Post by rgs2001uk on Sept 5, 2018 22:17:43 GMT 7
Expat lived overseas since 1990 with no desire to return to jolly ole blighty.
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AyG
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Post by AyG on Sept 6, 2018 8:13:57 GMT 7
QROPS no longer make sense for Thai expats because of a 25% tax on money transferred. SIPP is now the way to go (and the charges are substantially lower, which is a good thing.) However, as a non-resident you may find it extremely difficult, if not impossible to open a new SIPP whilst non-resident.
However, where is the money to invest coming from? Company pension? Personal pension? Something else? There may be other options.
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Post by Fletchsmile on Sept 6, 2018 12:10:08 GMT 7
A few years back QROPs was probably worth considering. These days much less so. - There have been a lot of regulatory issues and problems around QROPS and providers. - Pension regulations and arrangements in the UK for SIPPs have become much more attractive than they used to. These include: > the ability to take the pot in one go (subject to tax). > increased flexibility around drawdown > use in mitigating inheritance task The regulatory regime in the UK around SIPPs is safer and better regulated with more protection. Charges on SIPP plans are also significantly lower. You can do on self invest platforms like HL/Bestinvest etc I looked at it a few years back and did consider QROPs after educating myself on all the pros and cons but decided to stick where I am. Looking today that would be an even clearer decision. What I also decided was that there was no rush for QROPs either. To me it seemed sensible to continue to hold funds in my SIPP in a better, safer, lower cost environment, avoiding middle men. There they can grow. However, a year or two from retirement I could still switch. Grow my portfolio in my SIPP on more favourable terms and switch to QROPs much later down the road, leading to a bigger pot and avoiding higher charges for years until potentially needed. If anyone tries selling you a QROPs, ask them for a written summary of the pros and cons and why QROPs would make sense for you. Post it here and we can pull apart the salesmanship and sort reality from marketing.
Financial advisors love them for the fees and commissions they can earn
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Post by rgs2001uk on Sept 6, 2018 20:40:37 GMT 7
QROPS no longer make sense for Thai expats because of a 25% tax on money transferred. SIPP is now the way to go (and the charges are substantially lower, which is a good thing.) However, as a non-resident you may find it extremely difficult, if not impossible to open a new SIPP whilst non-resident. However, where is the money to invest coming from? Company pension? Personal pension? Something else? There may be other options. Coming from a gold plated final salary pension scheme. Rather than waiting until I am 65 then drawing a monthly pension, I have the option of cashing in the pension transfer value. The cash in value is 300k. |
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Post by rgs2001uk on Sept 6, 2018 20:52:45 GMT 7
A few years back QROPs was probably worth considering. These days much less so. - There have been a lot of regulatory issues and problems around QROPS and providers. - Pension regulations and arrangements in the UK for SIPPs have become much more attractive than they used to. These include: > the ability to take the pot in one go (subject to tax). > increased flexibility around drawdown > use in mitigating inheritance task The regulatory regime in the UK around SIPPs is safer and better regulated with more protection. Charges on SIPP plans are also significantly lower. You can do on self invest platforms like HL/Bestinvest etc I looked at it a few years back and did consider QROPs after educating myself on all the pros and cons but decided to stick where I am. Looking today that would be an even clearer decision. What I also decided was that there was no rush for QROPs either. To me it seemed sensible to continue to hold funds in my SIPP in a better, safer, lower cost environment, avoiding middle men. There they can grow. However, a year or two from retirement I could still switch. Grow my portfolio in my SIPP on more favourable terms and switch to QROPs much later down the road, leading to a bigger pot and avoiding higher charges for years until potentially needed. If anyone tries selling you a QROPs, ask them for a written summary of the pros and cons and why QROPs would make sense for you. Post it here and we can pull apart the salesmanship and sort reality from marketing.
Financial advisors love them for the fees and commissions they can earn
 , tell me about, Please see the draft recommendation below: The FCA report costs £1,900 – we pay for this upfront which then gets taken from the pension upon transfer. Momentum SIPP - £300 setup and £500 on going fee RL360 – 99% allocation and £400 annual fee £20 dealing fee Adviser fee 3% initial fee 0.5% per annum Every spiv, wideboy and his soi dog wanting a piece of my hard earned. I asked about cashing the lot in, 300k pension pot, hit up for 45% emergency tax. 12k tax allowance in the uk, anything over that taxed at 20%, ffs , what does 12k get you these days. Not mentioned, a pension that kicks in at age 60, oap I wont get til I reach 67. If I add the lot together thats over 20k per year. No wonder my head is hurting. |
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Post by Fletchsmile on Sept 7, 2018 16:03:28 GMT 7
rgs that really highlights what a money grabbing lot they are Best bet is really as you are doing: educate yourself and then manage it yourself. If someone decided that QROPS may be for them down the line, just thing how much bigger there pot could be by leaving it to grow in a SIPP and paying those charges way down the line when you actually need to. For the SIPP, look for an execution only platform. Not sure whether you have contacted Hargreaves Lansdown or not. For me they are the benchmark and default on these things if they will accept you. If you're abroad it will be difficult to open new accounts with them. However, I believe a transfer in of a SIPP is something they will consider even if non UK resident. Pretty sure they would say no to just opening a new SIPP and adding to it. However, you may be able to transfer an existing pot in without adding to it. |
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AyG
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Post by AyG on Sept 7, 2018 16:27:46 GMT 7
QROPS no longer make sense for Thai expats because of a 25% tax on money transferred. SIPP is now the way to go (and the charges are substantially lower, which is a good thing.) However, as a non-resident you may find it extremely difficult, if not impossible to open a new SIPP whilst non-resident. However, where is the money to invest coming from? Company pension? Personal pension? Something else? There may be other options. Coming from a gold plated final salary pension scheme. Rather than waiting until I am 65 then drawing a monthly pension, I have the option of cashing in the pension transfer value. The cash in value is 300k. No decent IFA would countenance cashing in a final salary pension scheme like this. I was only able to do so by becoming an "insistent client". If you haven't come across that term, then something is very wrong. You're not going to be able to cash in 100% of the transfer value without paying a ridiculous amount of tax, even if you transfer out of the company pension. The best you can hope for is 25-30%. Unless you expect to die in the next year or two and are desperate for cash, this isn't a route you should be going down. |
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AyG
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Post by AyG on Sept 7, 2018 16:35:21 GMT 7
Momentum SIPP - £300 setup and £500 on going fee RL360 – 99% allocation and £400 annual fee (1) I'm guessing that what's been recommended is a Momentum International SIPP, which is based in Malta. As a non-resident you probably can't open a UK-based SIPP, so it has to be offshore, which entails rip-off charges. (2) RL360 appears to be some sort of offshore bond, so adds another layer of very high charges - you're not investing directly in funds. Your IFA appears to be an expert in maximising his/her commission. If I were you I'd take the opportunity to run at this stage. Leave your pension where it is. Take a lump sum if/when you can. And rue the petty bureaucracy that makes it impossible for non-residents to have access to decent financial services in the UK. |
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AyG
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Post by AyG on Sept 7, 2018 16:38:14 GMT 7
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Post by rgs2001uk on Sept 7, 2018 21:11:49 GMT 7
Coming from a gold plated final salary pension scheme. Rather than waiting until I am 65 then drawing a monthly pension, I have the option of cashing in the pension transfer value. The cash in value is 300k. would countenance cashing in a final salary pension scheme like this. I was only able to do so by becoming an "insistent client". If you haven't come across that term, then something is very wrong. You're not going to be able to cash in 100% of the transfer value without paying a ridiculous amount of tax, even if you transfer out of the company pension. The best you can hope for is 25-30%. Unless you expect to die in the next year or two and are desperate for cash, this isn't a route you should be going down. The IFA is only one of about 3 I am using as a vehicle to get my hands on the pension pot, certainly not one I would take indepandant financial advice from. , insistent client, I think matey boy got the message the other day, I am using him to best serve my interests, he aint using me or my money to best serve his interests. Quite a strange conversation, there at one time was a stony silence on his part when I mentioned, paying the tax wouldnt be a problem. Concur about the tax, the problem is, whats a ridiculous amount, and how much will it cost me in the long term if I dont pay it and take the money and run? , I dont expect to die, and I dont need the money. My reasons for thinking about cashing in are, Access the pot now rather than waiting til I am 65. The money is better in my bank account than the companies, and can be making money for me. It would be invested in LTFs in Thailand. No need for the mrs to worry about exchange rates, she will no exactly what she will get. No need for the mrs to have to deal with overseas IFAs. As already mentioned, this pension fund added to others puts me over the tax threshold in the UK. Any particular reason for not cashing in? All 3 of these people seemed to be pushing SIPPs, I actually phoned one of the SIPP providers direct, and was told I couldnt use his services without going through an IFA, I asked why I would need to use an IFA? Its a effin snake pit of nepotism and cronyism. Matey boy cant get his head round the fact, there is no inheritance tax in Thailand, and I can walk in off the soi and talk to Aberdeen or UOB direct without going through an IFA. |
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Post by rgs2001uk on Sept 7, 2018 21:32:44 GMT 7
Momentum SIPP - £300 setup and £500 on going fee RL360 – 99% allocation and £400 annual fee (1) I'm guessing that what's been recommended is a Momentum International SIPP, which is based in Malta. As a non-resident you probably can't open a UK-based SIPP, so it has to be offshore, which entails rip-off charges. (2) RL360 appears to be some sort of offshore bond, so adds another layer of very high charges - you're not investing directly in funds. Your IFA appears to be an expert in maximising his/her commission. If I were you I'd take the opportunity to run at this stage. Leave your pension where it is. Take a lump sum if/when you can. And rue the petty bureaucracy that makes it impossible for non-residents to have access to decent financial services in the UK.Noted already, I donrt claim to be a financial expert, if anything I am smart enough to know I am dumb. I am ruing it already. Thanks for your help, I appreciate it, same goes for Fletch as well, thanks lads, thats a few beers I owe you both next time we meet up. |
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Post by Fletchsmile on Dec 7, 2018 12:04:12 GMT 7
RGS did you look any further on this?
Have been revisiting this again myself recently for my own defined benefit scheme. Following on from the link AyG posted is a reasonable article about QROPs 10 Reasons to use a QROPS – Facts and Mythstailormadepensions.eu/10-reasons-use-qrops-facts-myths/It sums up quite well what I posted before about QROPs probably don't make much sense for many people these days, and also when I said that article does a decent job and saves us pulling apart ourselves much of the salesmanship vs reality mentioned |
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Post by Fletchsmile on Dec 7, 2018 12:30:33 GMT 7
I recently requested a transfer value on an old defined benefit scheme. I was very pleasantly surprised by the valuation. It works out at a multiple of 40+ times the annual pension I would receive. Last time I requested a value was around 2012 and the multiple was more like 25 times the annual pension I would receive. A big factor in this is low gilt yields. Generally the lower gilt yields are the more your pension is worth, as with low yields the pension fund needs more money to achieve the same level of income. Not all a pension scheme will of course be invested in gilts, but a significant portion is. My thinking is that gilt yields are still very low. Some of the lowest I've seen in my lifetime. After the GFC and very low interest rates. Although they've picked up a little rates are still low. So with low gilt yields transfer values are higher These low interest rates won't be around for ever though. While I don't expect rates to rocket up, I do think they'll be higher in 5 years time. Look at the rises in US interest rates. We're a bit behind that, but not unreasonable to assume a similar pattern of rising rates in coming years. perhaps a Brexit hiccup, but looking 5 years out I don't think we'll be on such low rates. Even Thailand is looking at rate increases. So I'm currently looking at transferring my UK defined benefit (final salary) scheme into a UK SIPP. I wouldn't want to touch QROPS or offshore bonds, but based on what I've seen so far a UK SIPP would do nicely for me, and interest rates seem to very favourably affecting my transfer values  |
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Post by rgs2001uk on Dec 7, 2018 20:42:26 GMT 7
Fletch, didnt go Qrop or Sipp route, have left the pension where it is.
The valuation you recieved is sometimes referred to as the brexit bonus.
40 times, nice one.
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, tell me about,
Jan 4, 2023 21:15:53 GMT 7
Jan 4, 2023 21:15:53 GMT 7
