Trying to merge UK pensions, possible and/or worth it?
Jul 14th 2019, 10:38 pm
#1
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Thread Starter
Joined: Jul 2014
Location: Northern Atlanta area, GA
Posts: 243
Trying to merge UK pensions, possible and/or worth it?
Hi,
I've read the mega-threads about UK pensions and didn't see a clear answer to my question. Please correct me if I am wrong. My question is, is it (ever) worth it to try to merge two or more UK pensions, as a US resident?
I have two employer-based pensions that I contributed to when I lived in the UK earlier in my life/career. One pension is with Aegon and the other is with Scottish Widows. The values of the pensions combined is less than $50K, and I have been reporting the pensions on my FBAR each year, but not on my tax returns as my combined overseas assets is less than the reporting threshold. The pensions have been left alone for many years now and while they have experienced some growth, the growth has been lackluster. I asked my US-based IFA to look at the UK pension plan investment options and advise on some better investment choices going forward. Those were identified and I was just about to make the necessary changes when I wondered if it would be worth merging my Aegon pension into my Scottish Widows pension, as the Scottish Widows pension investment options are cheaper and outperform the Aegon investment options. Unfortunately, Scottish Widows seems to have a rule where you can only transfer in other UK pensions if you're a UK resident. This seems like a weird rule, which I haven't yet followed up with Scottish Widows about. However, I was wondering if anyone on the forum has merged UK pensions together, as a US resident, and if so, what experience you had? Were there any tax issues to deal with? If this is going to cause issues, I am okay with just changing the investments and leaving the pensions as they are.
Thanks.
I've read the mega-threads about UK pensions and didn't see a clear answer to my question. Please correct me if I am wrong. My question is, is it (ever) worth it to try to merge two or more UK pensions, as a US resident?
I have two employer-based pensions that I contributed to when I lived in the UK earlier in my life/career. One pension is with Aegon and the other is with Scottish Widows. The values of the pensions combined is less than $50K, and I have been reporting the pensions on my FBAR each year, but not on my tax returns as my combined overseas assets is less than the reporting threshold. The pensions have been left alone for many years now and while they have experienced some growth, the growth has been lackluster. I asked my US-based IFA to look at the UK pension plan investment options and advise on some better investment choices going forward. Those were identified and I was just about to make the necessary changes when I wondered if it would be worth merging my Aegon pension into my Scottish Widows pension, as the Scottish Widows pension investment options are cheaper and outperform the Aegon investment options. Unfortunately, Scottish Widows seems to have a rule where you can only transfer in other UK pensions if you're a UK resident. This seems like a weird rule, which I haven't yet followed up with Scottish Widows about. However, I was wondering if anyone on the forum has merged UK pensions together, as a US resident, and if so, what experience you had? Were there any tax issues to deal with? If this is going to cause issues, I am okay with just changing the investments and leaving the pensions as they are.
Thanks.
Last edited by cautiousjon; Jul 14th 2019 at 10:53 pm.
Jul 14th 2019, 11:19 pm
#2
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Joined: Nov 2007
Posts: 906
Re: Trying to merge UK pensions, possible and/or worth it?
I have done that in a SIPP, it was very easy. As you have found out some UK investment firms don't want US based customers. AJ Bell is one option for you.
Jul 15th 2019, 11:16 am
#3
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Joined: Aug 2013
Location: Athens GA
Posts: 2,134
Re: Trying to merge UK pensions, possible and/or worth it?
Hi,
I've read the mega-threads about UK pensions and didn't see a clear answer to my question. Please correct me if I am wrong. My question is, is it (ever) worth it to try to merge two or more UK pensions, as a US resident?
I have two employer-based pensions that I contributed to when I lived in the UK earlier in my life/career. One pension is with Aegon and the other is with Scottish Widows. The values of the pensions combined is less than $50K, and I have been reporting the pensions on my FBAR each year, but not on my tax returns as my combined overseas assets is less than the reporting threshold. The pensions have been left alone for many years now and while they have experienced some growth, the growth has been lackluster. I asked my US-based IFA to look at the UK pension plan investment options and advise on some better investment choices going forward. Those were identified and I was just about to make the necessary changes when I wondered if it would be worth merging my Aegon pension into my Scottish Widows pension, as the Scottish Widows pension investment options are cheaper and outperform the Aegon investment options. Unfortunately, Scottish Widows seems to have a rule where you can only transfer in other UK pensions if you're a UK resident. This seems like a weird rule, which I haven't yet followed up with Scottish Widows about. However, I was wondering if anyone on the forum has merged UK pensions together, as a US resident, and if so, what experience you had? Were there any tax issues to deal with? If this is going to cause issues, I am okay with just changing the investments and leaving the pensions as they are.
Thanks.
I've read the mega-threads about UK pensions and didn't see a clear answer to my question. Please correct me if I am wrong. My question is, is it (ever) worth it to try to merge two or more UK pensions, as a US resident?
I have two employer-based pensions that I contributed to when I lived in the UK earlier in my life/career. One pension is with Aegon and the other is with Scottish Widows. The values of the pensions combined is less than $50K, and I have been reporting the pensions on my FBAR each year, but not on my tax returns as my combined overseas assets is less than the reporting threshold. The pensions have been left alone for many years now and while they have experienced some growth, the growth has been lackluster. I asked my US-based IFA to look at the UK pension plan investment options and advise on some better investment choices going forward. Those were identified and I was just about to make the necessary changes when I wondered if it would be worth merging my Aegon pension into my Scottish Widows pension, as the Scottish Widows pension investment options are cheaper and outperform the Aegon investment options. Unfortunately, Scottish Widows seems to have a rule where you can only transfer in other UK pensions if you're a UK resident. This seems like a weird rule, which I haven't yet followed up with Scottish Widows about. However, I was wondering if anyone on the forum has merged UK pensions together, as a US resident, and if so, what experience you had? Were there any tax issues to deal with? If this is going to cause issues, I am okay with just changing the investments and leaving the pensions as they are.
Thanks.
Jul 15th 2019, 4:12 pm
#4
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Joined: Mar 2017
Location: Austin, TX
Posts: 455
Re: Trying to merge UK pensions, possible and/or worth it?
I consolidated a Scottish Widows pension into an Aviva one, and I have another legacy Aviva pension that I'm in the process of consolidating.
It was time-consuming, although the paperwork wasn't too bad once I received it.
Unfortunately there's not really any avenue to transfer your UK pension funds into your 401k, so you'll need to leave the money in the UK until you retire.
