"A bit of bother" nets $140,000 | Britannia Financial Services NZ

26-Oct-2018

Woman who thought she had $30,000 in her pension scheme ends up with $170,000.

Donna Mathewson had 140,000 surprises after transferring her UK pension to New Zealand – all of them dollars.

Mathewson (not her real name), now retired and living in Auckland, had lived and worked in Britain for nearly 30 years. In that time, she worked for a series of financial institutions, some of which provided private pensions – the kind where, like KiwiSaver, both employer and employee paid in but (unlike KiwiSaver) the pension stopped when she left the company.

“I thought, at best, they would fetch me about $30,000,” she says. “I had left the three companies involved years ago and I thought to myself that they were only very minor funds in which the money probably wasn’t going to grow that much.

“Just shows how wrong you can be – it ended up being about $170,000.”

Mathewson is a fine example of the situation that often arises when Kiwis who have lived in the UK return and Britons emigrate here – often discovering they have an undiscovered bounty sitting in a pension fund or funds. Because she worked in the finance industry, she had a better understanding than most that she might be sitting on some sort of nest egg.

Not everyone is well informed. Auckland-based Britannia Financial Services Ltd, a company whose management  and staff have completed over 20,000 pension transfers since 1996*, says most people “are totally unaware” how much money they have in their pension. Sometimes they don’t know what pensions they have or even if they have one.

However, it must be pointed out that not every pension holder is better off when it comes to transferring a pension to New Zealand or other countries they might settle in. Depending on individual circumstances, it can be better to leave the funds in Britain as the total amount gained over time could be more than if it is transferred*.  

“I could have left that money there but, at my stage of life [nearing retirement], I thought it was better to move the funds to New Zealand so I could be in control, rather than leaving them in the hands of the pensions funds in the UK. 

“It’s a highly complex field, pensions, and the documentation and jargon used can be very confusing,” says Mathewson. “The documentation I received was full of figures but I just didn’t get a clear idea from them how much money was involved.”

She took her documents to Britannia, perhaps New Zealand’s most experienced retirement planning and financial advice company specialising in transfers of UK pensions.  

“I even said to them, ‘I don’t know if this is worth your while,’” she laughs. “I said, ‘I don’t know if I should even bother’.

“They came straight back at me saying that of course I should bother; that it was my money and my savings and, however much it was, I was entitled to it.”

Less than six months later, the $170,000 was sitting in her bank account.

“At times, it seemed like there was a never-ending stream of documentation that I had to sign. But Britannia made it so easy and were so thorough, professional and honest, it was easy to let them guide me through it.

“I just thought, ‘Wow’ and once I had the money here, I re-invested it with Britannia. That’s how much they impressed me – because I had been burned before by another investment company.

“I am lucky enough to be able to live off my New Zealand national super and other investments and I have not touched that $170,000 yet and have set it aside [for her old age].”

Mathewson says she has also come across several British people who have emigrated to New Zealand and she has lost no time telling them to investigate whether they have pension funds accruing in Britain.

*There are many “for” and “against” reasons for transferring a UK pension. For a list of pros and cons, and for more information, please go to: britanniafinancial.co.nz/uk-pension-transfer-benefits