Anyone know about with-profits?

(7 Posts)
Cornishblues Sun 24-Jul-16 19:43:59

My work is changing its pension provider. I've been paying into with profits (pru) about £50 a month for 2 or 3 years. By default my contributions will be moved into the new provider, but because it's with profits I have the option to continue with the existing at least for a period if I choose to. Obviously they're being very slippery shouldered and unable to provide advice, but it's hardly worth asking an ifa for such a small sum is it? anyone know if I'd be shooting myself in the foot if I just stopped paying into it, or where I can find some helpful info? From the short fact sheet that came through I can't see any reason why not to just move, but I have had a reminder so wonder if I'm missing something?

Sunseed Mon 25-Jul-16 18:28:24

Who is the new provider and what fund choices are available to you? What are the total annual charges and how do they compare to the current arrangement? Does your employer make any contributions and will these continue? Do you know why they are changing provider?

Cornishblues Mon 25-Jul-16 19:45:35

Thanks for your reply. The old scheme that I was paying into the with profits for was just part of the old pension arrangements, a voluntary thing for extra contributions. That bit is the part that's moving. It looks like the new one is the employer's own funds as it doesn't mention any external provider (it's quite a big employer) - though maybe I just don't know where to look. There is an option to go with their default investments rather than choose funds; even if I choose to select my own funds there is no with-profits option. Choices if I elect to make my own decisions (which I don't imagine I ever will) are things like growth fund/moderate growth fund/cautious growth fund/uk equity/global equity/emerging markets/sharia fund/ethical equity/bond fund/cash fund. Doesn't say about charges, presumably these won't be visible for the default option. Employer puts in very small contribution (bulk of employer's contributions are to a different section of these new arrangements). According to one statement management charge was 1% for that year but it might change in future. They are saying that the move is because they believe the new scheme will provide better value for money.

Sunseed Wed 27-Jul-16 06:38:11

I should go with your first instinct and just move.

pinkhorse Wed 27-Jul-16 06:52:59

Selecting your own funds gives you more option to choose the risk that suits you. Some of these funds will be more high risk than others. High risk can give a better return but also could go in the opposite direction.
Your attitude to risk should reflect how long you have left to retirement. You don't really want to take high risk if you're close to retirement.

You will be able to get fact sheets for all those funds. Have a look at those. Speak to a financial advisor if you're unsure.

Cornishblues Thu 28-Jul-16 14:45:38

Thanks both!

BackforGood Thu 28-Jul-16 15:00:59

Don't know if the Money Advice Service can help you ?

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