If you’ve moved to New Zealand, you may be wondering whether your UK pension should come with you.

In some cases, shifting your pension can help maximise your retirement savings.

Here are a few things to think about if you’re considering your next step. 

Tax-free window 

When you first move to New Zealand, you have four years after you first become a tax resident in which you can transfer your pension to this country without incurring a New Zealand tax obligation.

Provided you move your pension to a recognised overseas pension scheme (ROPS) there should also be no tax bill or penalty from the UK, either.       

Investment flexibility

Moving your pension may offer you increased investment flexibility.

In New Zealand, ROPS are usually portfolio investment entity (PIE) funds, investment platforms or self-administered schemes. 

You should be able to direct your investments to the assets that most suit your investment goals. You might invest some in managed funds, some in exchange-traded funds, and perhaps some in fixed-interest investments. The right mix will depend on your circumstances and goals.

You can sometimes choose to keep your money in UK pounds, or convert it to New Zealand dollars – or have a mix of both. 

When it comes time to withdraw your money, you can choose whether you want to make the withdrawal as a lump sum, a series of regular payments or a mix of both. People can usually make a withdrawal from a ROPS when they turn 55.

Currency questions

One of the issues that people moving pensions must consider is the currency implications.

Depending on how much money you’re transferring, movements in the currency can make a significant difference to your balance. 

Understanding the implications is important, and we can help you to work through those. 

But often, people find that having their investments in the same currency that they are using in their day-to-day lives is helpful in the long run. It reduces the risk of a surprise drop in the value of your pension due to currency movements just when you want to access it.

Align with your goals

You probably have big plans for your retirement in New Zealand.  

Transferring your pension may give you increased oversight of your investments. It could also enable you to target your desired retirement outcomes more effectively if you are able to centralise your investments in one place, or under one adviser.

You’ll need to think about how your UK pension fits in to your overall investment picture, including any KiwiSaver you might build up through working in this country, and other investments you might have alongside it. 

Many people choose to transfer their pensions to New Zealand because having all their investments in one country can be an easier prospect to manage.

We can help you to determine whether your UK pension and other investments are likely to deliver the outcomes you need, to be able to achieve your retirement goals - and any changes you might need to make to align them.

We’re here to help

Whatever your questions about transferring your UK pension, we are here to help. We’re UK pension experts and can help you to work through the implications of making such a move, and consider how it fits into your overall retirement planning. We’ll help you get the most out of your retirement years in New Zealand.

Disclaimer: Please note that the content provided in this article is intended as an overview and as general information only. While care is taken to ensure accuracy and reliability, the information provided is subject to continuous change and may not reflect current developments or address your situation. Before making any decisions based on the information provided in this article, please use your discretion and seek independent guidance.