Why different rates to transfer pensions?

dunstonh

1. The IFA has now told everyone that the employer has now agreed to contribute to SW for those that wish to stay with them (and the vast majority will stay as they "Do not see the point" in paying the £500 transfer fee).

That is probably short sighted as I would expect Scot Life to be cheaper than Scot Wid. They are probably not looking at the bigger picture. However, any decent IFA should have no difficulties pointing that out and providing a cost analysis.

2. Whilst my friend, who is 7 years away from retiring, was discussing his pension with the IFA, the IFA said to him "Come to me when you buy an annuity and I will look at twenty of the deals and get you the best one", with no mention of charging him a fee.

Which is fair enough.

Why would the employer now agree to contribute to them, apparently, poorer value SW pension?

Employers will often go with the route of least resistance when it costs them no difference. Probably a few staff members have moaned.

Why, if I may ask, did you say you'd pick SL over SW every time?

Scot Life contracts are cheaper, administration and service is better (in my experience), Good governance on investment options and options to suit all sorts.

Shouldn't the IFA have said how he would search the WHOLE market for the best deal and that he'll charge a fee for it?

He may well have done. You say the other person said that he said (get the point ) that he would search from 20. I doubt there are 20 active open market option providers at this time. The figure, if it was given, may have been picked as an indication of the possible numbers that get researched. A hypothetical transaction in 7 years time would not expect to be costed now. I wouldnt mention my fee now in that situation. I would mention it at the time. Who knows what will happen between now and then.

Special_K10

As usual, you speak utter, utter sense.
Yes, I got your point

By the way, I was well aware of the employees' short term view. It is driving me nuts. I try and try to explain the long term view but all they see is the five hundred pounds.

To paraphrase something I once read- It's like trying to teach algebra to a dog.