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Costs to transfer Defined Benefit Scheme to Income Drawdown
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vaultsman
Posts: 12 Forumite
My 58-year old partner, who is a cancer sufferer, has been a member of her employer's occupational Defined Benefit pension scheme since 1985.
As she has limited life expectancy, she is considering taking a Cash Equivalent Transfer to set up a flexible drawdown plan. She has been given a CETV of £206,000.
She has been in consultation with one financial advisor, who she gave authority to speak to the Trustees on her behalf, and was rather surprised to learn at a meeting with the FA today that their fees to complete the work would amount to 3.5% of the transfer value.
This may be a "how long is a piece of string" question, but to a layman such as myself, a figure in excess of £7,000 does seem excessive.
We'd be interested to hear any views on this from more experienced forum users.
Many thanks.
As she has limited life expectancy, she is considering taking a Cash Equivalent Transfer to set up a flexible drawdown plan. She has been given a CETV of £206,000.
She has been in consultation with one financial advisor, who she gave authority to speak to the Trustees on her behalf, and was rather surprised to learn at a meeting with the FA today that their fees to complete the work would amount to 3.5% of the transfer value.
This may be a "how long is a piece of string" question, but to a layman such as myself, a figure in excess of £7,000 does seem excessive.
We'd be interested to hear any views on this from more experienced forum users.
Many thanks.
0
Comments
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As with anything - shop around. Get quotes from other IFAs - see http://www.unbiased.co.uk
I guess it's likely to be expensive because of all the regulatory hoops and risk of misselling claims etc.0 -
She has been in consultation with one financial advisor, who she gave authority to speak to the Trustees on her behalf, and was rather surprised to learn at a meeting with the FA today that their fees to complete the work would amount to 3.5% of the transfer value.
Usually £2500-£5000 is typical.This may be a "how long is a piece of string" question, but to a layman such as myself, a figure in excess of £7,000 does seem excessive.
Its high but certainly not excessive given the risk on the case.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
What does she expect to do with the DD pension after her death? IS her LE reduced to one year or less?
If she wants you to have it, you should marry.0 -
What does she expect to do with the DD pension after her death? IS her LE reduced to one year or less?
If she wants you to have it, you should marry.
No, I wouldn't be the beneficiary, and nor would I want to be as she has a son in his early 20s just finishing university.
The main reason for the drawdown route is she would like him to benefit from all those years of pension contributions.0
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