I’ve got a blog hosted on .wordpress.com, ie the free version.
I’m thinking of re-activating my hosting package so I can have my own WP installation, and therefore have more customisation options open to me etc.
I’m getting traffic from search engines, how can I redirect this traffic to my new location?
Once I have the new one setup, I would prefer people to view that instead of my old site, what can I do to achieve this, whilst retaining my position in search engines?
Didn’t try this myself (self-hosted from the start), but this seems fitting guide for your situation:
How to Migrate your Blog from WordPress.com to a Personal Domain ( Digital Inspiration )
It looks like this is now a standard feature on WordPress.com.
http://en.support.wordpress.com/offsite-redirect/