IFA Costs for Transfer of Benefits

fairleads

Tron1969 wrote: »

I don't have a spouse or dependents no. The Transfer value is approx. £220k of which I can start at 55 if I wished. The DB pension is £5.5k a year and £16.5k lump sum at 60 or £6.4k a year and £19.7k lump sum if taken at 63. No I don't think I will die early but no guarantees so I would rather take it earlier.

I think due to the size of the transfer value that would suite me better but I have to take independent Financial advice to release the fund into my SIPP that woulkd be costly advice if the cost is (£2.5 to £10k as quoted above)

Agreed there is no guarantee in the SIPP but looking at historical performance the funds I would choose have performed pretty well over the last 15 years (and I understand they can also go down). The above DB pension also increases with RPI to max 5%

Assuming growth of 5% p/a on your 193.5K (220k-10Kadvice fee -16.5k lump sum) then you could draw 460 per month increasing at 5% p/a for 36 years before you exhaust your annuity capital.

Malthusian

Stubod wrote: »

I recently had a quote re a CETV offering about £66k for a pension worth £1.5k yr with virtually no index / cpi linking..so seems like a bit of a no brainer for me to take the CETV? (..am over 55...).

Defined benefit pensions must be at minimum linked to the CPI by law so you should check your statement again.

AlanP_2

Malthusian wrote: »

Defined benefit pensions must be at minimum linked to the CPI by law so you should check your statement again.

Sorry, but this is not correct.

A DB scheme I am a deferred member of has made 1 * 1% increase to Pensions in Payment over the last 11 years.

The scheme rules effectively say that the company (that is now responsible after a couple of restructures and amalgamations / sales) has to consider the recommendations of the Trustees as regards annual increases.

Every year the Board consider it and say - NO.

See https://www.pensions-ombudsman.org.uk/wp-content/uploads/PO-4065.pdf for ombudsmans view when this was challenged.

neilvw

And of course if a scheme is all pre-88 GMP it wouldn't have to increase in payment at all.

Rick_Shaw

Definitely worth shopping around - I've approached 10 or so IFAs and have been quoted anywhere between £1,000 and £4,500 for a transfer value of just over £50k