Pension Planning - Switching Pensions

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Switching Pensions

If you already have a personal pension started some years ago, it might not be a good idea to switch to a stakeholder scheme, even though the latter offers a better deal to new investors.

This is because you typically paid a big chunk of the costs of a personal pension up-front when you first took out the scheme.

Should you stop your personal pension now, those up-front costs crystallize as early surrender charges that will reduce the value of your pension fund, perhaps even less than you have invested in it.