final salary pension scheme

mccarthy1

Each of the IFA,s knew about my LGPS and assumed a full state pension (no reason to think otherwise)
I am still working at local government and contribute 6.8 % monthly to the scheme.

I intend to continue to work for at least next 5 years as will my partner who has 35 yrs LGPS contributions

mgdavid

mccarthy1 wrote: »

Thanks for your comments.
Some of the replies to my request for advice do seem to be disrespectful..........

They may seem that way to you but people will respond on the facts before them. At the moment it's a guessing game because you are being coy and not giving the full scenario to support what you want to do.
The IFAs will have no doubt done a basic Q & A with you and are refusing on the basis they know more than we do.

hyubh

RickyB2000 wrote: »

Why should DB holders be treated differently?

Leaving aside the fact this question assumes agreement with the 2015 changes, one obvious one is that if person A has a substantive DB entitlement and person B a substantive DC pot, then the chances are that person A has been contracted out for most/all their working life and so will be getting less state pension than person B. Ergo, if both blew their private pension, person A may end up drawing state benefits in their old age person B would not.

The government knows DB schemes will on the whole try to 'con' people out of money if they can (which will lead to mis-selling). Again, being emotive but it will be seen as a con by most people.

What on earth are you going on about? DB scheme trustees have a legal obligation to act in the best interests of scheme members as a group.

xylophone

http://www.fca.org.uk/firms/financial-services-products/investments/pension-transfers

The IFA must look at the individual circumstances of the client and must be able to provide grounds for the advice that is given.

If you find an IFA with the necessary qualifications and pay him to analyse your situation, presumably he must supply a report?

The report may very well say that a transfer is not recommended but having the report and producing it to the Pension Scheme Trustees would show that you had met the advice requirement?

If you could then find a scheme that would accept the transfer even though against IFA advice, the Scheme Trustees could not refuse a transfer out?

http://www.ft.com/cms/s/0/bc140a14-ee46-11e4-88e3-00144feab7de.html#axzz44gx9l6pa

The article above (from around ten months ago) indicated that some providers eg AJ Bell and Aegon would accept transfers against advice but of course this position may have changed.

C_Mababejive

Surely if you are single,no dependants etc it would be a good idea to consider transferring and freeing up a DB pension pot? you might croak early and leave it all behind with the company!

mgdavid

C_Mababejive wrote: »

Surely if you are single,no dependants etc it would be a good idea to consider transferring and freeing up a DB pension pot? you might croak early and leave it all behind with the company!

Possibly; then again you might spend it all via drawdown and run out by age 80 - and exist another 20 years in a basic grotty Council-funded care home.

RickyB2000

hyubh wrote: »

Leaving aside the fact this question assumes agreement with the 2015 changes, one obvious one is that if person A has a substantive DB entitlement and person B a substantive DC pot, then the chances are that person A has been contracted out for most/all their working life and so will be getting less state pension than person B. Ergo, if both blew their private pension, person A may end up drawing state benefits in their old age person B would not.



What on earth are you going on about? DB scheme trustees have a legal obligation to act in the best interests of scheme members as a group.

I am on about the fact that the transfer value will not be equivalent to the DB benefits. Generally it will be much lower. So to someone receiving that transfer, they are likely to feel conned when they realise. Then they will complain and PPI type companies will crawl out of the woodwork with mis selling claims. Sure, the scheme won't think it has conned someone, but from the point of view of the pensioner (and the PPI style company) it will be a con. I can see the media reports already. So when I say the scheme will con you, it will from your point of view.

I still don't buy the blow pension thing. In case 1 the government has to pay out extra pension. In case two they pay out extra benefits. The cost is the same. Now, the person in the second case hasn't paid in as much, though I wonder if someone blows their whole pot whether the tax they will pay on the pot (and on the purchase of that farrari) will more than cancel out the reduced NI payments. Not to mention that as current pay outs are funded out of current contributions, it is to a degree irrelevant what you paid into the system. Of course there is a question of fairness, but the DC holder probably has had to pay in a LOT more to get the same level of benefit and so has probably paid a lot less in tax then the DB holder over their lifetime.

deaglecat

Brogden wrote: »

A transfer from a DB scheme involves the giving up of guarantees - that is the difference. 'Generally' there are not guarantees in the DC world.

My DC has transferred out quickly but the DB is very slow and costly but in the scheme of things all OK...I understand this

It should not be this way and shortly it won't be this way because all of the DB people will have gone.....:(

"Guarantees" are only as good as the scheme's ability to meet their liabilitiies - and any industry/govt scheme to backstop it (albeit with some loss of benefits).

Does the fact that a DB scheme is significantly in deficit make a good reason for wanting to exit ?

Think of (say) the steelworkers DB pension scheme...

Brogden

deaglecat wrote: »

"Guarantees" are only as good as the scheme's ability to meet their liabilitiies - and any industry/govt scheme to backstop it (albeit with some loss of benefits).

Does the fact that a DB scheme is significantly in deficit make a good reason for wanting to exit ?

Think of (say) the steelworkers DB pension scheme...

A very meaningful point in my opinion.

Brogden

mccarthy1 wrote: »

IFA,s are refusing to write any letter confirming I have been to them for advice.

I also have a local government pension and will get a state pension.

The IFA's may be refusing to produce the letter you require. It would be nice if they could possibly explain why that is.

Without going into the precise requirements which I cannot recall without going into all of my paperwork.........the IFA must have the 'special' permission from the FCA to be able to advise on the potential transfer from a defined benefit scheme. The IFA must have passed the old qualification G60 or the newer AF3 and have then applied to the FCA for the permission to advise on matters of this type. They must have been accepted by the FCA and their PI insurer must have acceped this too. Most IFA's are not in this camp.

I am not sure if this explains the atttitude of the IFA's to which you have referred? They surely should have explained the reason they could not provide a letter?

Once again - I wish you the all best with this.