Guest Blunderboy Posted November 21, 2008 Share Posted November 21, 2008 Hi guys. My wife and I are off to Melbourne in the new year and we've just got back from a fact finding trip. I'm on top of most of it though when it comes to our pensions I'm still am still a bit confused. Both of us have public service final salary schemes with over 30 years combined service plus I have a small personal pension with Standard Life. We spoke to Pension Transfers Direct & Global Destiny in Aus and the impression we got was that a pension transfer is a no brainer due to the tax benefits the Australian system provides. What we don't understand is how on earth they can deduct that it's worth giving up the guaranteed pensions we have - especially in the current market??! I can appreciate the plus side of the transfer but there has got to be risks which weren't really covered. Any guys out there transferred a final salary with these guys? If so how did it go? We've also done some research on UK advisers and there does not seem to be too many who do this. Prism Xpat seem to be the most respected and their website highlights that not all pensions should be transferred and they have the most qualified "guys" in the industry which sounds positive, though on the flip side comments on forums say they're not cheap. Any guys transferred final salary scheme's with Prism Xpat? Jeez this is tough!! Link to comment Share on other sites More sharing options...
Quoll Posted November 21, 2008 Share Posted November 21, 2008 I dunno, in this climate I think it would be foolhardy to swap a final salary indexed pension (and yours sound very good!) for something that is at the whim of the market. I have seen my additonal super fund absolutely plummet in the past few months and that wouldnt have happened with a final salary indexed one. There is also the added "bonus" that if you transfer your funds over immediately (and I think you are allowed 6 months to think about it???) and it all goes pear shaped for whatever reason, then you cannot take them out of Aus again until you reach retirement age if you have PR. I definitely think you need more advice from an independent financial advisor who is not in the business of pension transfers but, sorry, dont know any. Link to comment Share on other sites More sharing options...
Guest Bonniebuster Posted November 21, 2008 Share Posted November 21, 2008 Hi We are in the same situation we are both on final salary schemes with sixty years between us, and we are asking the same questions as you, especially when I hear from friends in Oz telling me the pensions funds are not doing very well!! I have already posted on this forum and have had some sound advice but we are still undecided, be interesting to see what advice you get. Godd luck Link to comment Share on other sites More sharing options...
Guest Blunderboy Posted November 21, 2008 Share Posted November 21, 2008 Thanks guys. I've was told about this 6 month deadline the Aussies put on you which seems to me as a kinda threat - lol. But I guess the longer you leave the decision the worse it becomes..... I get the feeling that all the Aussie advisers will do is just transfer without consideration. The name Pension Transfers Direct kinda gives it away!!! Link to comment Share on other sites More sharing options...
Guest Posted November 22, 2008 Share Posted November 22, 2008 Thanks guys. I've was told about this 6 month deadline the Aussies put on you which seems to me as a kinda threat - lol. But I guess the longer you leave the decision the worse it becomes..... I get the feeling that all the Aussie advisers will do is just transfer without consideration. The name Pension Transfers Direct kinda gives it away!!! Sorry - totally off topic - now there's a real blast from the past - I was also a huge Dave Mackay (and Spurs) fan more years ago than I can almost now remember. Just checked out that he is now 74 ! Jim Link to comment Share on other sites More sharing options...
Guest Blunderboy Posted November 24, 2008 Share Posted November 24, 2008 Big Dave was a bit before my time but he is a legend still down the Lane - as well as my Scottish team Hearts of course. Following Spurs this season is less stressful than sorting my pensions!!! Link to comment Share on other sites More sharing options...
Mongrel Posted November 24, 2008 Share Posted November 24, 2008 Thanks guys. I've was told about this 6 month deadline the Aussies put on you which seems to me as a kinda threat - lol. But I guess the longer you leave the decision the worse it becomes..... I get the feeling that all the Aussie advisers will do is just transfer without consideration. The name Pension Transfers Direct kinda gives it away!!! You will find the banks uses them to transfer, if you dont transfer within 6 months you get walloped for tax, depends if you are stoppin and that final salary, I know at lot of schemes where they are being scrapped. I transferred company pension but think should have waited while I was 50 and took it as a lump sum and transferred it because I think the company took there contributions out. You should be able to get advice in the uk.I transferred mine thro Commenwealth Bank and they used Pension transfers, they have to be qrops or something. Mally Link to comment Share on other sites More sharing options...
Alan Collett Posted November 27, 2008 Share Posted November 27, 2008 You will find the banks uses them to transfer, if you dont transfer within 6 months you get walloped for tax, depends if you are stoppin and that final salary, I know at lot of schemes where they are being scrapped. I transferred company pension but think should have waited while I was 50 and took it as a lump sum and transferred it because I think the company took there contributions out. You should be able to get advice in the uk.I transferred mine thro Commenwealth Bank and they used Pension transfers, they have to be qrops or something. Mally You don't get "walloped for tax" if you transfer a UK scheme to Australia more than 6 months after moving to Australia. The tax charge is based on the increase in the value of the fund between the day you become a tax resident of Australia and the day the monies are received in Australia (not the whole amount transferred) - and the tax is usually payable by the Australian super fund that receives the pension benefits from the UK. Note also that a lump sum from a UK scheme received at retirement can also be subject to tax in Australia if received when a tax resident of Australia. I agree that final salary schemes introduce more complexity into the decision as to whether or not to transfer a UK fund to Australia. However, as others have said, the tax treatment of a transferred scheme is VERY attractive compared with a fund that is left in the UK. I also agree that super fund values in Australia have (in general) taken a battering over the last 6 to 12 months. However, I'd not make a decision regarding whether or not to transfer based on the turmoil of the last 12 months - planning for retirement is a strategy for the long term, usually 20+ years. Those concerned should feel able to send me a PM or email if they would like the name and contact details of my colleague who advises on the question of transferring pension funds to Australia from the UK. Best regards. Link to comment Share on other sites More sharing options...
Guest Blunderboy Posted November 28, 2008 Share Posted November 28, 2008 From what I understand when you look at the tax scenario on pensions I think Australia is better, especially in retirement. I and most people don't require accountants, we need financial advice from a reputable source which can be held accountable for their recommendations. From the quiet response it looks like as though not many people are aware of such a company! Anybody got any thoughts let me know, though I've decided to drop Prism Xpat a line next week. Looking at their website they have actuaries who specialise in pensions analysis and they talk about the risks involved, unlike the Aus advisers. Again any guys with experience of these guys out there?? Link to comment Share on other sites More sharing options...
Alan Collett Posted November 29, 2008 Share Posted November 29, 2008 I'm not clear what you are looking for: advice on whether to transfer, or to which Aussie super fund your UK pension scheme benefits should be transferred - or maybe both? Maybe start by taking some advice on whether to transfer. If the advice is "Yes, transfer" then take a view on whether you require assistance with the pension transfer process and/or into which Aussie fund your scheme benefits should be transferred. You don't have to undertake all these processes with the same firm ... In making the assessment as to whether or not to transfer I'd also remember that there are some fairly significant assumptions inherent in the forecasting process. I'm not an actuary (unlike the Prism chaps), but if you instruct them I'd explore their assumptions and the point at which those assumptions cause their decision to change from transfer to not transfer. All this said, in a purely qualitative context I would generally start from the basis that if you intend to live in Australia in your retirement I would tend towards wanting assets and income denominated in A$'s. The fact that income and/or capital deriving from a transferred scheme would be tax free and capable of being passed on to my beneficiaries would also incline me towards transferring. Good luck - I know it isn't an easy decision. Link to comment Share on other sites More sharing options...
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