Excited but Nervous - Transferring Final Salary Pension

Cat_House

Had my first ever meeting today with an IFA.

Between Hubby and myself we have 550K in pension values, of which one of mine is a Final Salary with a transfer value of 267K, with a projected payout of 8.5K a year and 4K to my hubby if I die. I was convinced that I would never touch my FS Pension, as always advised, but desperately want to quit my job of 19 years.

I am so excited that it appears I can retire now at the age of 57. My husband has been unemployed for the last three and a half years because of relocating for my job and I now want to spend this current and future time with him. He is coming up to 62 and it seems despite all his skills, that he is now unemployable.

I am really, really nervous about transferring my final salary pension, but if I can achieve my goal of early retirement, I should be well happy, shouldn't I?

bugslet

Yay:j, very exciting.

I'll be interested to see what everyone says. I'm seriously thinking about giving up work.

Good luck.

chiefie

30 times the pensions. If she got that I would go for it. A bird in the hand ��

Cat_House

I forgot to mention, that purely based on the IFA meeting today, I will be handing my notice in on Monday after my holiday. That is seriously nerve wracking.

Thrugelmir

chiefie wrote: »

30 times the pensions. If she got that I would go for it. A bird in the hand ��

No longer a guaranteed income though. Personally I'd retain a secure base income before speculating. Jan today or jam tomorrow as the saying goes.

ischofie1

I'd go for it.
It's a good transfer value & early time retired is very vauluable.
Just manage it sensibly & you should be fine.

k6chris

I know I'm being stupid here, but if you have a FS pension and (I'm assuming) your husband has a DC pension, why do you have to cash your pension in to retire? What is your FS pension worth if you access it at 57?

Dasa

Can I ask you how much the IFA is charging you for his advice please?

maximumgardener

a key challenge will be you and your husband setting your income level/s for your 550k portfolio.

also you will wish to minimise your respective tax positions

looks like a joint "floor" income of 25k and "ceiling" of around 35k could be achievable for next few years till state pensions kick in etc ?

sandsy

That's not the greatest ever transfer value. Given the inflation proofing on the pension, it's not a given that transferring is the best thing to do.

bowlhead99

You mention your transfer value is £267k but the alternative is an £8.5k pension (presumably inflation linked) for perhaps four decades. So, it doesn't sound a 'no brainer' if you're in reasonable health but does give you some flexibility to make it through to state pension age if you no longer want to work and are happy to spend your pension money to get out of the rat race several years earlier. Remember the cost of retiring earlier is not just the cash you spend in those years without an income, it's the extra savings / investments / pensions you don't build up for those years too.

However, depending on your joint income needs you could feasibly use your DC and husband's pot to bridge the gap to state pension age while keeping the powder dry on your final salary one. It doesn't have to be an all-or-nothing solution on the whole £550k.