Hi All,
I'm a UK expat with an old pension in the UK.. it will pay out $15k next year (on my 55th Birthday).
One option is to move it to an offshore account that is legal and recognised by the IRS as a legitimate pension fund... Called a QROPS.
I have just been offered a buyout value of $404.000.. not bad, almost exactly 25 times the value of the pension... Tax free of course.
The advantages are obvious.. My money in MY accounts.. doesn't matter if the company goes bust, if I dies my Wife gets all of it, not just half, value should grow over time faster than my pension value etc etc.
Downsides... FEEES... damn its expensive!.. like 1.5% plus.. To an index investor used to 0.05% ETF's this is brutal! Also leaving money with a pension is a great hedge against market risk... i.e market tanks for several years in theory you have "guaranteed" money if you have a pension. there is also the risk of the unknown.. How legit are these companies, what if they go bust etc etc.
As for our financial situation.. we absolutely do NOT need the money.. we have $1.55M in liquid assets, paid of house, this pension, My Wife's pension in 8 years and rental business (about $15k a year).
Thoughts?