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Myths of pension transfers



Over the last 17 years of transferring pensions we see some consistent pension transfer myths. More often than not once we have explained the situation to people their situation becomes much clearer. Here are three of the biggest myths

myth 1: You need to convert to NZD

Lots of people hold off on even looking at a UK pension transfer because the exchange rate freaks them out. Depending on when you started tracking the New Zealand dollar to British pound you might have seen highs of three dollars fifty to the pound and lows of one dollar seventy, and this can play a part in the decision making process. But what most people don’t know is that when you transfer a UK pension to New Zealand you don’t have to convert it into New Zealand dollars.
In fact by holding off transferring their pensions because of the exchange rate they are losing control. If you want complete exchange rate control transfer to a New Zealand superannuation schemes where you can invest in sterling denominated funds and dollar denominated funds.  This ability to hold the funds in sterling also means that you can convert your pension from sterling to New Zealand dollars at a rate on any given day – as the transaction can be done on a day in New Zealand.  If you leave your funds in the UK and wait for the rate to get to a value you like by the time you complete the pension transfer process (which generally takes three months) the rate can be completely different.
Furthermore, the current exchange rate may actually be working in many peoples favour when it comes to calculating the tax on a pension transfer to New Zealand (particularly if you can remember when it was three dollars to the pound). For an understanding of why this might be the case we recommend that you read the following…read more

myth 2: Never touch a final salary scheme

The never touch a final salary scheme mantra is loudly banged drum in the UK, indeed it is even institutionalised in the regulator. And the beat of the drum may be good and fine when you live in the UK and all the variables like interest rates and tax are constant. But what if your former employer simply can’t afford to pay the pension anymore, or they’re offering a kings ransom for you to leave the scheme or you could save so much tax that your pension would be worth a third more. All good reasons to look at your final salary scheme right.
Well for most final salary schemes they are offering a kinds ransom. The Cash Equivalent Transfer Value (CETV) of a final salary scheme (which is essentially the amount that a scheme will send to another scheme) does not, in the short term, move in direct relationship with the amount of yearly pension they will pay you.
The CETV is determined by calculations (and not the amount of funds in a pot) of which a big variable is interest rates in the UK, the CETV can move wildly. But the general rule of thumb is the lower the interest rates the higher the value of the pension pot. How much is this effect – well a clients CETV moved by over 10% in a three month period when long term interest rates dropped 0.2% in the UK. The important point to understand is that interest rates are at historic lows in the UK driving very high CETV’s. Find out more here.

myth 3: All QROPS are equal

It’s definitely not a case of one size fits all, some have more investment options, others are more tax efficient, some hide fees away (like charging 1.5% on converting your funds from one currency to another or form one fund to another). What that means is you should not settle for the first QROPS you come across. It also means watch out for advisers that only deal with one scheme, they are not independent and you might not be getting the best option in the market for you.
So speak to us today to ensure that you get the right scheme for you.

NZ free phone:0800 102 599 / OZ Free Phone:1800 857 410 /

very stress free

Thank you Cambel for your help and guidance throughout this process in getting my pension transferred (very stress free for me). It is greatly appreciated and I would certainly recommend you and Charter Square to others who are interested in transferring their pension.

David R, New Zealand

You guys rock!

I just wanted to say a great big thank you to you and your team. You are all totally awesome. I received a cheque yesterday from the Prudential to apologise for the ‘recent inconvenience’ that I had experienced. Thank you for doing this for me. You guys rock!

Noelle B, New Zealand

professional, insightful

Charter Square were professional, insightful and a pleasure to work with. They rose to the challenge of consolidating my overseas pensions and bringing them home with minimum fuss for me and maximum effort on their part.

Jens H, New Zealand

thorough, professional and prompt

Very thorough, professional and prompt service from the team at Charter Square. Thanks for making the bewildering world of pension transfers super simple.

Jules T, New Zealand

Best party to deal with

Thank you kindly for keeping in touch with me. For now, I will not be moving my pension. I will however be keeping your details and referring back to you when I wish to pursue. You by far are the best party to deal with, no nonsense, professional and in my opinion genuine. I do sincerely thank you for your advice to date.

GE, New Zealand


Securing the freedom to use savings that are actually ours to work with has been stressful in the extreme. While I never planned on giving up there were many times when the current (UK) holder made the whole process seem well beyond my determination and ability. It’s easy to look at the 36 month history of this claim with the benefit of hindsight, but the conclusion is that employing Charter Square in the first instance would have been wise had I been able to anticipate the red-tape that appears to have been deliberately created to stall access.

CP, Auckland
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