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Transfer myths busted – your most common questions answered

Transferring investments to another provider is an important decision and can often raise a lot of questions. We take a look at, and answer, the most common questions we’re asked about transferring.

Important notes

This article isn’t personal advice. If you’re not sure whether an investment is right for you please seek advice. If you choose to invest the value of your investment will rise and fall, so you could get back less than you put in.

Transferring investments is a decision that should be made with care, especially during times of uncertainty like we’re experiencing now.

Often people considering transferring will have many questions. To help, below are some of the most common questions we’re asked about transferring to HL.

Remember this article isn’t personal advice. Unlike cash, investments will fall as well as rise in value so you could make a loss.

Before transferring any investment you should check you won’t need to pay high exit fees, and you won’t be giving up any valuable benefits or guarantees. If you’re not sure what to do you should consider seeking financial advice.

Frequently asked questions

“Will volatile stock markets affect my transfer?”

There’s no predicting or avoiding the ups and downs of investing. If you’re considering transferring investments and you’ve got good reason, then you might not necessarily want to delay. But you need to decide what’s right for your situation. You also need to be willing to accept you might be out of the market and or unable to make changes to your investments while the transfer is taking place – which could be particularly risky right now.

For example, with a cash transfer, your investments will be sold and the cash will be transferred to us. If you transfer as cash you’re out of the market while your transfer takes place. This might work in your favour if the market falls, but if it rises you will not benefit from any growth while you hold cash.

If you’re transferring as stock you will typically be unable to sell your holdings during the process, for example if you wish to shelter yourself from further falls or realise any gains.

“Is it quicker and better to transfer as cash or stock, and do I get to choose?”

What’s best for you will depend on your situation. You can choose to transfer by stock or as cash. But on occasion a cash transfer might be your only option. If markets fall, this could work in your favour. If markets rise, you could miss out on any gains. Even if you decide to buy the same investment back, its price is likely to have changed during your transfer.

Many transfers can be made electronically and some are still by paper. With the pandemic applying pressures to businesses in the UK it could take hours, days, weeks or even longer for transfers to complete.

Generally speaking (and in usual circumstances) cash transfers tend to complete quicker than stock. This is because cash can often be transferred electronically and all in one go.

Stock transfers are different. Investments aren’t always held directly with your provider, there could be a third party involved. This means different investments could be transferred at different times – usually you won’t be able to access your investments until the entire transfer is complete.

At HL we do all we can to process transfers as quickly as possible, and if your existing provider isn’t responding we’ll still actively try to contact them in any way we can for an update on your behalf.

“Can my new provider accept any investment?”

It’s not always possible to transfer investments as they are. In some cases a cash transfer might be your only option.

You might find that the investments you hold aren’t offered by your newly chosen provider, in which case they might also need to be sold ahead of time and transferred as cash. This could be because your current provider has such limited investment choice, or obscure versions of what’s available on the wider market. This is particularly true for investments held in older pensions, especially if it’s provided by an insurance company. Cash transfers might also be the default, or only option offered by your pension provider.

HL are the UK’s biggest investment platform, so it’s more than likely your investments will be available through our service. You can find more information about our full range of investments online, or contact us to double check what we offer.

Find out more about the services we offer

“What can I do to avoid any delays?”

It isn’t easy to predict if or when a delay might happen, but there are some things you could do to make sure your request goes through as smoothly as possible.

  1. Complete ALL details on your transfer application form – missing out any information can hold up the transfer, especially if it has to be done by post.
  2. Make sure that the account and personal details you provide match exactly what your current provider holds – If you’ve moved house or changed name, you need to make sure you’ve let your existing provider know. If all your details don’t match, then the transfer could be rejected and you’d have to start the process again.

At HL, once our team receive your transfer application, we’ll normally be able to do the rest for you. But if there’s something you need to do, for instance sign other documents, then we’ll get in touch. Once the transfer is under way, you shouldn’t need to contact your existing provider again and we’ll let you know when the transfer completes.

“Is it free to transfer?”

It is with HL, but you could be charged to transfer away from your existing provider, and depending who you choose as your new provider they might charge an account set-up fee. You should check with both parties before applying to transfer for details of any charges. Other charges could also apply once you’re with HL.

Compare HL charges

“Will transferring affect my ISA allowance?”

Transferring an ISA doesn’t affect your annual allowance. However if the ISA you want to transfer is one you’ve paid into this tax year, then all of this year’s contributions will need to be transferred in full. Contributions from previous tax years can be transferred in full or in part.

If you’re planning to transfer this tax year’s Cash ISA subscriptions and you’ve already subscribed to a Stocks and Shares ISA this tax year as well, then you won’t be able to transfer to a different Stocks and Shares ISA. Transferring previous tax years’ Cash ISA subscriptions is fine.

“Can I do a partial transfer?”

We accept partial transfers to our Stocks and Shares ISA, Fund and Share Account and SIPP. But you should check with your current provider that they’re also able to do so.

Remember if you’ve already contributed to an ISA this tax year, those contributions will need to be transferred in full. Only previous tax years’ contributions can be transferred in part.

Find out more about transferring to HL

“Will I miss out on dividend payments if I transfer?”

Not if you’re transferring as stock. If the dividend is paid to the other provider because you held the investment with them on the ex-dividend date, then the money will be forwarded to us and we’ll pay it into your account. If you transfer as cash, and the ex-dividend date comes after your stock has been sold, you won’t receive the payment. Going forwards we’ll be responsible for claiming your dividend payments and crediting them to your account.

“Will I lose any guaranteed benefits?”

If you have benefits attached to your pension or other investments, you should always speak to your current provider before applying to transfer.

Remember for certain safeguarded benefits, both HL and your current provider might require financial advice to be taken. This would apply to any Defined Benefit pension transfer that’s worth over £30,000 – and we’d need evidence that the advice was in favour of transferring in order to proceed with it.

If you have any other questions why not contact us.



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Important notes

This article isn’t personal advice. If you’re not sure whether an investment is right for you please seek advice. If you choose to invest the value of your investment will rise and fall, so you could get back less than you put in.

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