Not happy with People's Pension/lack of pension freedoms

[AntiqueMaps]

My workplace pension is with these guys.

I've been with my employer for 5 years and, at present, hope to stay for many years to come. (I'm early 40s).

People's Pension/BC&E (whatever they are calling themselves these days) don't allow "partial transfers". A bit of a misnomer but basically means you can't move money/investments from them to another provider (eg Vanguard where I have my SIPP) unless a) your employer leaves the scheme; or b) you leave your employer.

There are v limited options to choose from when investing with People's Pension. You can't choose funds as such, you can only choose what % of your money is invested in stocks - 100/75/50 etc.

I believe some of the other Government-mandated workplace schemes are similar. Apparently it's engineered like this to "keep costs down". Albeit PP find the money to advertise all over the bloody place.

Vanguard is not (yet?) an approved workplace pension provider so can't even petition my employer to switch to them.

I think this all stinks to be honest. What happened to fair competition? And "pension freedoms" where you can make choices re your OWN money? I would want to transfer my money to my SIPP regularly but no, I'm stuck with PP for 20+years.

I'm surprised some of the youtubers eg James Shack and Damian Talks Money don't make a bit more of this.

I watched a Pension Playpen video last week about Pensions Dashboard and in that I think the pension industry statistics was that the average someone has in a workplace pension is £4000.
I’ll try to find a link to the video if you are interested.

You are paying attention to your pension. Many people do not. Many will be in the default fund, paying in the minimum, and not be thinking anything about it. The lack of engagement means the pension providers don’t get pressured into providing more fund choices.

Damien did an interview with Nest Pensions about how they changed equity percentage of the Sharia fund. I felt that Nest did not care about those of us who wanted a global equity fund, they acknowledged that some people were in the Sharia fund to get the high equity percentage so why could they not have provided a World fund so those who wanted more than 70% equities could have that? Why don’t they allow partial transfers out? So at least then those who wanted more choice could get it elsewhere.

Thanks @nannynick I agree, it's about lack of engagement. I highly doubt most people have ever logged onto their workplace pension never mind switched funds/considered turning off automatic glidepathing to lower risk funds.

I only make the minimum contribs to my workplace pension. Any additional money goes to my Vanguard SIPP instead where I feel like I'm actually in control.

Vanguard won’t allow partial transfers out of their pension either - I had wanted to avoid their higher platform fees and transfer my Sipp to InvestEngine, who are fee free and have a larger selection of funds. I came up against two problems - InvestEngine cannot pension payments via company funds and Vanguard won’t allow me to do a partial transfer allowing me to pay company funds into my vanguard Sipp and reduce platform fees. It’s quite frustrating, I’ll be moving from Vanguard once I find another suitable platform

People’s pension is basically a government encouraged scam IMO. I know loads of people who’ve ended up paying way more tax than they should/lost tax relief due to people’s pension only applying the basic tax rate relief and 40% payers having to fill in a tax return to claim the additional money back, which they then make it extremely difficult to pay in.

They also don’t send people any information to let them know about this. Shameful IMO.

@logplant I don't really understand your post. Are you a company director?

@YaWeeFurryBastard to be fair - that is the same for all pension providers - 20% gets added at source and it's up to the individual to claim back any additional tax they are owed. There's no law that says you have to pay the additional tax into your pension. But yes you are right, additional ad hoc AVCs are complicated with workplace pensions. I prefer to have a SIPP and put extra money in there where I am in control.

It’s not the same, my workplace pension (major brand) isn’t like that, the contributions are paid in gross of tax so I get full relief without having to mess round with claiming and repaying in.

Of course there’s no obligation to pay the reclaimed tax back into the pension, but either way no doubt tens of thousands of people will be paying too much tax and the people’s pension are doing nothing to highlight this to them.