Transferring contracted out pensions to a SIPP

Investment choice for your protected rights pension

Over six million people have contracted out of SERPS. New rules which came into effect in 2008 allow investors who are happy to make their own investment decisions to invest this money within a SIPP.

Until then a quirk in regulation had resulted in this money (known as protected rights) having to be held within traditional insurance company pension arrangements. Many have performed poorly and have offered policyholders a limited investment choice.

Transferring to a SIPP gives you the opportunity to breathe new life into these often forgotten and neglected pension funds.

With the HL Vantage SIPP you can:

Manage your own pension and access the finest fund managers
Manage your pension in a similar way to your ISA
Choose from thousands of funds, shares, gilts and bonds
Switch into cash at any time
Consolidate all your private pensions under one roof making them far easier to manage yourself
Make the most of new investment opportunities as they arise
Manage your pension online, by phone or through the post

If you choose the HL Vantage SIPP all of these benefits come at a very low cost. You pay no transfer-in fee, no set-up fee and no additional annual fee on 2,000 funds. We also offer initial savings of up to 5.5% on most of the funds in which you can invest. On a £10,000 investment this could instantly save you as much as £550.

Cliff D'Arcy, personal finance writer has a contracted out pension fund. In the lead up to the rule changes, this is what he said...

...as soon as October arrives, I will transfer my under-performing pension into my ultra-low-cost Vantage SIPP from Hargreaves Lansdown. I will then be able to choose exactly where to invest my money, aiming to improve on its poor investment returns to date. At last, I can have all of my personal pensions in one place, and under my complete control. Hurray!
Cliff D'Arcy, author of "The Financial Times Guide to Managing Your Money"

Transferring your pension to the HL Vantage SIPP

To transfer your contracted out pensions to the Hargreaves Lansdown SIPP simply complete a transfer application.

Before you proceed, please ensure that you have read and understood the HL Vantage SIPP Key Features, Terms and Conditions of Business and Important Investment Notes. You should check that you will not lose any valuable benefits such as guaranteed annuity rates or incur excessive exit charges.

To apply for the Vantage SIPP and transfer your pension(s) download the full Vantage SIPP application. If you already have a Vantage SIPP simply download the transfer authority to transfer your pension(s).

Guide to improving your contracted out pension

Download your free copy of our quick guide to improving your contracted out pension now to see how you could benefit from the changes and make more of your pension by transferring to a SIPP.

Your free guide will include:

Protected rights / contracted out pensions explained
Why the changes are good news for investors
Important points to consider
What to do next

Contracting out explained

Over the last 20 years, most employed people could choose to be contracted out of the State Second Pension, or its predecessor known as SERPS, into a personal or stakeholder pension. In return they would receive an annual rebate of some of their National Insurance payments invested into a personal pension. This money is called protected rights, but you may also know it as a 'contracted out pension' a 'SERPS pension' or an 'Appropriate Personal Pension' (APP). Since 1988 over six million people have contracted out of SERPS. Are you one of them?

How can I find out if I have ever contracted out of SERPS?

To check whether you are or have ever contracted out, call the HMRC Contracted Out Pension Helpline on 0845 915 0150. Have your national insurance number to hand.

How can I trace any pensions of which I have lost track?

There is a government service which can help you track lost pensions or you can call the Pension Tracing Service on 0845 6002 537.