Pension?

I dont know if it will help anybody looking at this thread but a friend of mine who is a former UK investment and pensions expert is now working in conjunction with the recognised foremost UK authority on QROPS pension schemes. The guy worked in conjunction with both the UK government and opposition parties in putting together his paper for QROPS and his recommendations formed the basis for the government legislation. They are actually advising some of the large offshore financial consultancy and accountancy practices with what policy should be in terms of client advice.

If anybody thinks they would like to have a consultation with them let me know and I will exchange details. They are regulated and if there is no benefit to the pension holder for whatever reason then they will advise accordingly. They provide an extensive written report and explanation as to what their recommendations are. I am not a pensions expert so please dont ask me what qualifies and what doesnt but I do know that it can prove quite beneficial to the client in the right situation. Perhaps I should start a separate thread under QROPS?

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Does anybody under 65 (i.e. female pensioner!) get their state pension paid into a Spanish bank account?  Do they get a decent rate (i.e. better than tourist rate) and do they pay charges?  At the moment, my pension is paid into my UK Account and I am transferring via BBVA Spanish Link account, and if I keep £1,000 in my account in London, any charges will be refunded at the end of the year.  Not sure what to do for the best long term.  I am living in Spain full time now (applying for residencia next week), however I also have a civil service pension which has to be paid into my UK account (currently Alliance & Leicester).  Any advice please?

Many thanks.

Sue

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Hi Sue I suspect that you should maybe open an account with a currency broker or alternatively with a bank in the Uk that has an affiliate here in Spain (such as Halifax). I think it likely (in my experience) although others may beg to differ the exchange rate you get will be better with a currency broker than through the bank but either way it will certainly be better than tourist rate. Make sure that any broker you open an account with has an agreement to cover all landing charges with the receiving bank. By the sounds if things you could probably do better than you are with BBVA.

I doubt that the UK pension authorities will pay direct to a Spanish account but some of our older members would be able to confirm or deny. If they do I imagine they will probably stiff you on the exchamge rate you receive in the "caring sharing let's do all we can for Brits era" that we appear to be in.

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Hi Patrick

I did ring a currency broker with whom I have an account when we were in the UK earlier this month.  They offered me an exchange rate of 1.19 for one year, or 1.20 for two years, with no additional costs.  However I had to pay them one month's money up front for 1 year or two months' for 2 years.  At the time of phoning them, I didn't have enough money in my current account to be able to fix a rate for two years, and the risk was that by the time I transferred money there the rate might have dropped!  Also, the currency exchange company would in effect have a loan (of two months' money) from me for two years, if my understanding was correct!

I decided to transfer £5,000 pounds via BBVA and got a rate of 1.244.  I then transferred another £5,000 at the same rate.  As I said, I am charged £7 per transaction doing this online, however at the end of this year this will be refunded so long as I keep a minimum of £1,000 in BBVA London.  Of course I run the risk that the exchange rate will worsen and when I want to transfer more money the deal won't be as good.  

My options are to continue to have my pension paid into my UK account, and then transfer a lump sum when (hopefully!) the rate looks OK, or risk setting a low rate with a broker, which then will be fixed for 1 or 2 years, but at least know that if the exchange rate gets worse I won't lose out.

Any thoughts or experiences to relate anybody?

As ever,  your advice is appreciated, Patrick!

Sue

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Hi Sue,

It's quite possible to have your state pension paid into a Spanish bank account. I have been having mine paid in since last year although I don't live in Spain. The rate obviously varies but you usually get better than the tourist rate and you don't pay any charges.

It just involved one phone call and it was all set up- very easy!

Gloria

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Might be the best thing to do Sue - that way it will save you the worry of having to decide whether to look into a crystal ball or not. Only person that can decide is you - whether to opt for setting a forward rate with a currency broker (peace of mind) against transferring as and when needed (risking volatility). To be honest at rates this low I probably kno wwhat i would do but my attitude to risk will be different to yours and at the end of the day if the likes of the CEO of HBOS etc could not foresee what was going to happen to the markets then my view on exchange rates is not something you should factor into your equations - have to say I was shorting HBOS and RBS shares prior to Lehmans melt down.

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