Frozen UK Pensions - Options

I'm a UK expat and I've been living in Hong Kong for nearly three years now, and currently, I have no intention of moving back.


I have two pensions back in UK, and as soon as I left UK, I made the decision to freeze them. The reason being, that I was told by the very unhelpful Pension Providers that as I was working out of UK, I could not pay into them.


Obviously, when one freezes a pension, the pension will still increase/decrease in line with the value of the share etc....turns out one of my pensions has lost a lot of money in the last two years because I simply havent been monitoring its performance, and, having to deal with the UK Pension Providers while living here in HK is a real pain. Until recently, I'd just accepted it and that other UK expats where in the same position. Now for some reason, I'm taking this a lot more seriously and want to try and sort this situation out.


I've read about unlocking my pensions and transferring to QROPs, but the problem is that the combined value of my two pensions is not that large to make this a worthwhile option......(communicating with some firms, and also many other companies like Windsor based in and out of HK confirms this) which leaves me with the only option of combining the two pensions......and simply changing the funds......etc etc


FYI, I have an investment pension with a company (beginning with D) which is slowly beginning to perform a bit better.


Any advice would help.


Thanks!

Hi there, and thanks for your reply. I'm talking about private pensions. One I started when I was 23 and the other I started through work which was a company pension scheme. Both providers have been extremely useless and told me that


1) As I'm no longer living in UK, I cannot pay into them

2) I have to wait till my retirement age before making any withdrawals

3) I can transfer to QROPs, but for QROPs to be benficial, must be minimum 50,000 GBP.


Both of the pensions are fairly young, one is 7 years old (frozen for 3 years) and the other is 10 years old (frozen for 3 years).


The reason for my question is that there seems to be very little I can do other than to keep switching the funds depending on their performance until I reach retirement age. But the fact that I am intending to stay in HK for a long time, possible permanently, then these two pensions will be worthless when I reach retirement age :(


I've no idea what I should do....just leave them their, combine them into one single easier to manage pension and keep switching the funds, or try to transfer to QROPS........I'm only 33 by the way.

You probably can continue paying into one of them. The rule is something along the lines of you're able to continue paying contributions based on eligible taxable earnings within the past 5 tax years or, as a minimum, a contribution of GBP2,880 which the nice UK government tops up to GBP3,600. You can do this for up to 5 tax years after leaving the UK. I was in a final salary company plan before leaving the UK so had no eligible earnings that could used. But, I did have an old personal pension from a few years beforehand, which I was able to use for the 2,880 annual contribution. UK Gov has kindly obliged with their 720 contribution and notwithstanding market collapses, I'm just about up on the deal. Do some research on the HMRC website.


As to what else you might do with the 2 pensions in the UK (I assume they're both personal pensions or stakeholder pensions), you might want to merge them if one charges higher fees than the other (and there is no excessive penalty on transfer). You might want to keep switching funds, if you know what you're doing and you can be bothered. If the contents are worth less than 50K then a QROPS transfer is probably going to be relatively expensive in charges. But if HMRC continues to allow QROPS to exist, then I see charges coming down over time and you can revisit in a few years' time. If you leave the plans as is, then the earliest you can get some money out would be age 55 at which point you can take 25% as cash and use the exdess to purchase a pension or opt for gradual drawdown of funds. By the time you hit 55, I'm sure the rules will have changed...

Hi Dive Bum....thanks a lot for your useful response. I think I will try to merge them....someone from The Henley Group tells me that they are trying to look at ways of dealing with frozen pensions that are of lower value etc......