Spooked by IFA - non Approval fee and Concern

GSP

I had a brief call recently with an IFA using a list from those who are FCA approved.
He said I would be lucky to find anyone who would approve me transferring out of a db pension because of risks. He said the default position for an IFA is not to approve these. He said he did not want to take things further, not to approve my wishes and charge £2,500 to £3,500 to boot.
That's where I came to you guys.

Can anyone suggest my best course of action to achieve the transfer. Is it going to be difficult finding an adviser. Any recommendations who charges the best rates with ongoing activity reviewing the income pot thereafter.
Thank you.

dunstonh

I had a brief call recently with an IFA using a list from those who are FCA approved.

Just tidying up what you have said....

The FCA does not have an approval list. ALL IFAs are authorised by the FCA otherwise they cannot be IFAs. The FCA publish a register that shows firms and individuals that currently or have previously (since 2001) held authorisations in any control function that is regulated.

He said I would be lucky to find anyone who would approve me transferring out of a db pension because of risks. He said the default position for an IFA is not to approve these. He said he did not want to take things further, not to approve my wishes and charge £2,500 to £3,500 to boot.

Historically, that is the position you would expect as in most periods as doing a DB transfer would be classed as a mis-sale in 4 out of 5 cases. However, we are in a short window where DB transfers are appearing to be better in a much higher number of cases than is normal.

Is it going to be difficult finding an adviser.

No. Although it will take some shopping around. Only around 1 in 10 firms will do DB transfers to begin with. That is usually the hardest bit. The prices they will quote will vary significantly between them once you have tried several.

mark55man

How do you know that the transfer is the right thing for you to do.

sandsy

Why are you considering a transfer? Unless an adviser can demonstrate that it's likely to be in your best interests, they won't touch it.

So what are your key reasons for wanting to transfer?

GSP

Thanks dunstonh. If the IFA does not approve, can I still carry on with it and will this cause a problem. Any suggestions on how to track down an IFA who deals with db transfers.

Mark88man.
Everyone has different circumstances and aspirations, but I have not taken this decision lightly. I am 55 in July with no prospect of work and my redundancy has nearly run out. From it however I put half into a dc pension, paid off the mortgage and all cards and excluding shopping and anything going wrong brings my bills expenditure to c£4,400 p.a. My db pension normal retirement date is 60, so to draw that early would result in a third loss in penalties straight away. My aspirations are to enjoy my remaining years to aged 80, then use my planned deferred pension of 13/15 years lump sum and monthly state pension thereafter. Current CETV numbers show this to be x 35 my db pension, and the tax free lump sum itself would be £192k. With 3 inheritancies likely in twenty years or so, I should and will be able to get through.
Like many there are many decisions. I don't see what I would do with a db pension at 90 and be able to enjoy life as much as I can now.

dunstonh

Thanks dunstonh. If the IFA does not approve, can I still carry on with it and will this cause a problem.

That is a question you need to ask the IFA. Some will not sign the disclaimers if they are worded that a positive outcome was required.

xylophone

https://www.moneymarketing.co.uk/pension-transfer-advice-firing-line-fca-issues-new-guidance/

https://www.finalsalarytransfer.com/Uploads/1435150759Tideway-Why-Use-Tideways-Final-Salary-Transfer-Advice.pdf

You can try https://www.unbiased.co.uk/

which will allow you to select your area and then filter by pension transfer and specialist only.

mgdavid

GSP wrote: »

........ My aspirations are to enjoy my remaining years to aged 80, then use my planned deferred pension of 13/15 years lump sum and monthly state pension thereafter. ........

1. if you mean deferred State pension lump sum I believe this option has been removed and you will only be eligible for an increased pension.
2. SP can be paid weekly or four-weekly, not monthly.
3. Have you considered how you will pay for care or nursing costs when in your 80s and possibly 90s , having spent most of your pensions?

GSP

Thanks mgdavid.
1. Yes understand now the lump isn't paid. Wonder how much by deferring 13/14 years will increase my state pension.
3. Interesting. From what we have heard, people will be living longer putting more of a strain on resources. There will have to be big investments made to make this sustainable. I haven't had any thoughts on this in truth, just getting by enjoying life is my main focus for now. Know people have houses sold etc to raise funds.

jamesd

To avoid going over the same ground, others might review the very recent discussion with GSP in Nearly 55, Unemployed, sitting on potential large pension pot.

No surprise that an IFA responded like that. They may not even do transfer business or might not have fully considered your situation, which is one where a transfer is reasonable.

tacpot12

You are paying the IFA for advice. The advice costs the same whether you take it or not. So you need to find an adviser who is prepared for you not to take their advice.

My IFA said that if their advice was not to transfer, they would still sign the forms confirming that advice had been taken and would record on the forms that the advice was not to transfer. This was a key discussion during the fee negotiation. They charged £1000 to review two DB pensions.