Direct pension payment

We have been told that we may have our UK state pension paid direct into our Spanish bank account.  I have been on to the UK pensions people tp ask what exchange rate they use and they have replied saying that it will take them up to 16 weeks to answer my question!!

Has anyone any idea of the answer to this question?

 

Mike

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Government pensions, including Armed Forces Pensions, are now paid by a private company and they can pay direct into a Spanish bank account.  They use the commercial rate on the day your pension is due but they make an "admin" charge for this.

I don't know how much this admin charge is, sorry. 

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Mike,

contact Currencies direct . See https://www.currenciesdirect.com/individuals/regularmoneytransfers.php

Pay less, receive more. It's that simple

Pensions, mortgages, salaries – whatever your reason for making regular transfers Currencies Direct's Overseas Regular Transfer Plan can save you money.

This message was last edited by morerosado on 6/2/2007.

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Thanks for the reply.  It looks like I am going to get screwed whichever way I turn. It seems the cheapest way is to have my pension paid into my UK bank and then draw it in cash and pay it in to the Spanish bank when I get there (not a good idea I know).  However, I recently transferred £2,000 via a money handling company and their rate was only 0.1p better than I could have got a Marks & Spencer with far less hassle and far greater speed.

I don't seriously intend to walk around with large wedges of cash on me, but intend to find a better way somehow without loosing too much.  I was rather hoping the the UK Govt. would pay direct to  Spain using the exchange rate of the day, but too much to expect them to get their tiny minds around I guess!

 

Mike

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No, Xetog, that is definitely not the cheapest way.  Paying it into your UK bank and then transferring it, either by cash or whatever, is probably the most expensive way of doing it.  The bank will only give you the tourist rate, currently 7cents below the commercial rate.  I don't know how much your pension is but, say it is £500 a month, you will lose 35 quid every time you transfer.  The Spanish banks will then charge you for changing sterling into euros or, if you pay a cheque, will take £10 off the value of the transfer before changing it and will then take up to a month for the cheque to clear.  Last time I did it, it took six weeks to clear.  If you pay it into your UK bank and use the ATM facility, you will pay extra for this unless you use Nationwide who don't make charges.  You will, however, only get the tourist rate.

The UK government, as I said, will pay it directly to a Spanish bank but use a private company to handle the transfer.  I phoned a month or so back and was told the fee would only be "a couple of pounds" and they use the commercial rate.  Even if they charge £10 for doing it, it will still be cheaper than going through banks and ATMs.  This system only started in April this year.  I will dig out the name of the company making the transfers (Armed Forces Pensions Agency informed me of the new system) and let you know.  You could contact them direct and see what the charges are but bypass the banks if you can. 

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The company paying your pension into a foreign bank is Citibank.  A deduction is made from your pension for the admin costs.  The instructions are to contact your pension provider and they will tell you how much these costs are.

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Hi  Xetog  About 5 years ago there was an arrangement  when you had a UK pension paid into Spain that no charges were made and they gave the top rate, some of the banks did charge or tried it on ( as they will and hope you dont notice ) I think it was a European agreement,  is that finished?  only the pension service can tell you that or the pension overseas web sites could have that info.    Last year we opened a Nationwide Flex account its really great you get interest on your monthly ingoing payments you can also use the card overseas with no charges,  in the winter somedays we had a rate of 1.521 to the pound we had over 1.5 many times and that is only just below the offcial rate , you will proberly not get a bigger rate around and you can pick the day for taking the money out the cash machine,  at that time the best tourist rate we saw was only 1.47 .you can take £3oo out a day and then pay it into your Spanish Bank if required, you can also setup the internet side for checking the account , hope this info is helpful.   Regds Rosi n

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Thanks, that really is useful information.  I have tried the pension service.  It says nothing on their web site on the subject and when I e-mailed my query, I got an e-mail back saying they would answer within 10 days.  On the 10th day I received a letter saying that my query would be answered within 16 weeks.  I might have died of old age by then!

 

Mike

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