IFA Charges -thoughts please..

TheSurveyor_2

TH1878 wrote: »

Something doesn't stack up with those pension figures - the revaluation rate over the next 11 years (to go from £15k to £46k) is 10.7%

So, the OP is either an active member of the scheme (in which case, don't transfer) or the figures aren't right. Are you sure the £15k wasn't the pension at date of leaving the scheme?

In any case, the critical yield will be in the region of 11.5% to 12% per annum AFTER charges

I left the scheme in '97 with a pension at that date of £7.5k, now valued at £15k by scheme provider.
The projection at age 65 is then £46k (this figure has been provided by IFA). I take it then you think the figure of £46k at 65 is improbable?


Currently there are no active members of the scheme it was wound up a few years ago, it was over funded at the time so there was an uplift provided to all members in 2010, (I got 6% uplift) then the scheme funds were transferred to Pension Investment Corporation.

TH1878

TheSurveyor wrote: »

I left the scheme in '97 with a pension at that date of £7.5k, now valued at £15k.
The projection at age 65 is then £45k (this figure has been provided by IFA). I don't have a projection or illustration direct from the scheme provider. I take it then you think the figure of £46k at 65 is improbable?

I can't say for certain without seeing the figures but it looks too high.

Even if your pension consisted entirely of GMP rights with fixed rate revaluation, it would only increase by 7% (if you left the scheme before April 97) or 6.25% (after April 97).

Your pension is projecting an increase of around 10.7% - it just seems too high, particularly when it has revalued at around 4.1% since 1997 (which is more where I would expect it to be).

If you had the same revaluation between now and age 65, the pension would be worth around £23,337. Somewhat short of the £46k quoted.

TheSurveyor_2

I must say that seems more realistic, and even then may be high with the current low inflation rates!