Choosing your QROPS advisor
Finding a QROPS advisor is easy – but finding one who has the knowledge and experience to help you make the best of your investment is another matter.
The QROPS market is huge with more than a thousand product providers offering various investment schemes in many different tax jurisdictions.
Add to that the extra permutations thrown in by the tax rules of the country where a QROPS investor lives, and it’s easy to see that setting up the right product to match your personal needs is not quite so easy as it may seem at first look.
First and foremost, anyone considering transferring pension funds in to a QROPS needs to find a reliable advisor.
The advisor needs to be a qualified independent financial advisor with experience of offshore investments.
Independent status is important because the advisor should be able to search the whole of the QROPS market for a tailored solution to your personal financial objectives.
They must also be able to demonstrate some experience in successful QROPS transfers for other clients.
Most important of all, any investor needs to have a comeback if they are sold a turkey – and the best way of keep a firm hand on the reins is to work with an advisor regulated by the UK Financial Services Authority.
Don’t take that as meaning all overseas advisors are bad -many good advisors work for companies with offices outside the UK but are also regulated in this country.
A prospective QROPS investor should draw up a short list of advisors and ask them all the same questions -
What are your qualifications?
What is your experience with QROPS and offshore investments?
Does the Financial Services Authority regulate you?
Can you provide client testimonials?
Once you have selected someone you feel you can trust and work with, the next step is initiating the transfer from your existing pension in to a QROPS. Now, there’s a right and wrong way of going about this.
Any advisor wroth their salt will sit down and will want to know your current pension and financial status. After all, if you don’t have a benchmark, you cannot tell if your QROPS is an improvement on what you already have in place.
To do that, you need to provide a list of all your pensions – that may include personal plans, additional voluntary contributions (AVC) and employer schemes.
A state pension cannot be transferred in to a QROPS.
If you don’t know the details of your pensions, go to the government’s free pension tracing service web site (link: http://www.thepensionservice.gov.uk/contactus/contact-pod-form.asp) or call the Pension Tracing Service on +44 (0) 191 215 4491.
You will need to provide some details about yourself and the pension schemes, but can generally find out who is administering the scheme now so your advisor can contact them for fund performance details.
Bear in mind that when you select your advisor, he or she needs to be someone you can work with over the long term.
A QROPS is like any other investment, and needs regular reviews to keep the fund performance on track
