QROPS – What to look for in a pension : 2010-10-05
Signing up to whatever pension scheme your employer had on offer is one thing, but choosing an overseas scheme to transfer your pension pot to is a completely different matter. So when the time comes to transfer your pension assets abroad, how should you go about selecting another pension arrangement?
The first issue here is a rather comforting one: you are not alone. Most QROPS do not accept instructions from investors direct, and insist that you use an adviser to help you to navigate your way through the rules and regulations.
However, it is still worth considering what you are looking for. Fortunately for you, QROPS shoppers have plenty of choice, as there are well over a thousand QROPS list of approved schemes.
Not only do you have a wide choice of the countries which host QROPS to pick from, but there are also many kinds of institutions running them. These may include well known providers whose names may already be familiar to you, but may also include more innovative or niche financial services firms.
And then we come to the assets that QROPS hold. Some are simple vehicles containing stocks and shares. But others may have a more diverse range of underlying assets. If your pension scheme in the UK holds particular assets that you want to keep, you may even be able to transfer them to a QROPS in specie (as they are, without liquidating them), depending on what the pension regulations are like in your country of choice.
Some QROPS providers are able to offer bespoke schemes, although these may typically come with higher fees than those that serve investors by the thousand.
When it comes to QROPS fees, the same principles apply as with any kind of financial product. That is to say that transparency is the key. You need to know exactly what you will be paying, and when you have to pay it. If you use a large firm of advisers, you may even be able to get them to negotiate a significant discount on the fees that are originally quoted.
