What is Scottish Widows?
Scottish Widows is a life insurance and pensions provider located in Edinburgh (shocker!). It’s a subsidiary of Lloyds and has been around for more than 200 years (since 1815). It offers both personal pensions and workplace pensions. It also has life insurance and mortgage products, which we’ve reviewed.
Before you jump ship because you’re not Scottish or a widow – these aren’t requirements to get a product with Scottish Widows. The name is derived from the initial offering, which was set up to offer provisions for widows and female relatives of fundholders.
Scottish Widows personal pension
Scottish Widows’ retirement account helps you save up for your retirement and, eventually, take out your savings. Depending on where you are in your retirement journey, you can choose between retirement planning and retirement income.
Features of the Scottish Widows personal pension
- Flexible. You can save and take out your savings when and however you choose.
- Investment choice. You can choose from a range of different investments depending on what your goals are, when you plan to retire, how you feel about risk and how you plan to take your pension.
- Clear charging structure. It’s easy to see what you’re paying for.
- Up-to-date info. You can view the transactions online and keep track of your investments’ performance.
Key features of retirement planning with Scottish Widows
- Consolidate your pensions. If you have a bunch of pensions from old workplaces, then you can bring them all together.
Plenty of investment choices. There are a number of investment options that you can choose.
- Tax relief. This is kind of a given with all pensions – you usually get some kind of tax relief on the money you pay into your pension pot.
- Pension encashment. You can take some or all of your retirement planning as a cash lump sum, and 25% of this is tax free.
- Flexible retirement age. You can select a retirement age of up to 75 when you take out the account but can stay in it until you’re 99 if you want to.
Key features of retirement income with Scottish Widows
- Flexible income. You can move your pension savings into retirement income, which allows you to take a flexible (and taxable) income. The rest still has the chance to grow.
- Tax-free lump sum. You can take up to 25% of the money in your retirement income tax free.
- Choose how often you want to be paid. Income can be paid on a monthly, quarterly, half-yearly or yearly basis.
- Make changes whenever you like. Prefer to receive more frequent payments? You can change this whenever you want.
- Ad-hoc payments. Need a little cash injection (don’t we all?). You can take ad-hoc payments if you need one.
Scottish Widows pension fees
The maximum amount you’ll pay on your investments is 1.1%, but, like other investing platforms, the more you invest, the less you pay in relation to your total investment.
The overall charges are split into two:
- A maximum amount of 0.2% per year, depending on how you choose to take your pension when you retire.
- A service charge of 0.1-0.9% per year that decreases the more you put in.
Total value of retirement account
|From||To less than||Service charge (per year)|
|£1m and above||£1m and above||0.10%|
Pros and cons of Scottish Widows
- Simple charging structure
- Lots of flexibility with payment options
- Wide range of funds available
- Majority of funds have underperformed in recent years
- Mixed customer reviews
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