If you are a UK migrant or a Kiwi back from your overseas experience and you have left behind a company or personal pension fund, you may be able to transfer it back to New Zealand.
If you transfer your pension funds, you can:
Consolidate pensions from different employers into one
Access part of your fund well before retirement age
Avoid having to purchase an annuity
Gain much more say in how your funds are invested
Access your funds as a lump sum on retirement.
The UK government is quite strict about which superannuation funds you can transfer your funds to in New Zealand, and also about how much access you can have to the funds for 5-6 years after you arrive here. After that, you will be subject to the rules of the fund you choose, which can be quite flexible.
Pension Transfer Specialists – Our Top Tips On Who to Choose
A number of different companies in New Zealand can help you to transfer your pensions. Here is what to look out for:
Choose a company with extensive experience of pension transfers: Plenty of places will offer to look into pension transfers for you, but it is a specialised field. If they get it wrong, you can be taxed up to 55% of your fund by the UK government.
Check out the fees: Pension transfer services vary widely in the fees they charge for the transfer. Make sure you understand what you will be charged before you proceed with any transfer.
Investigate the New Zealand superannuation fund your pension pot is being invested in: You may hold this investment for decades, so make sure it offers the access to funds, range of investments, fees and levels of service that you require.
Get good advice: It may not be in your best interests to transfer your pensions, especially if you are lucky enough to be a member of a final salary scheme. Make sure you understand all the implications of transferring your pension before you proceed.
Watch out for exchange rate fluctuations: Most pension transfer schemes convert your funds into New Zealand dollars the moment they arrive in NZ, but you do not have much control over the timing of this as pension transfers may take anything from 6 weeks to 6 months to complete. The UK pound to New Zealand dollar exchange rate has been quite volatile of late, and you may end up losing a significant percentage of your fund to an unfavourable exchange rate.
A specialist company such as Broadbase International will be happy to advise you on your options and will transfer eligible pensions both large and small. Broadbase International can transfer the majority of UK pension schemes into a New Zealand superannuation fund, which allows you to hold your pension funds in Pounds (and earn a competitive rate of interest) while you wait for a great exchange rate.
This article was contributed by Jeremy Henderson from Broadbase International. Their UK website,www.broadbaseimmigration.co.uk, has a great range of up-to-date articles on life in New Zealand written especially for prospective migrants.
