Defined Benefit Transfer Costs

dunstonh

If an IFA advises that I leave my money in a DB scheme and I choose to ignore that, the risk is mine.

It should be. However, it isnt as simple as that.

The FCA provides guidance on how to deal with insistent clients.

The FCA also tells advisers that they should not carry out transactions that they know to be wrong.

The FOS takes a slightly different view to the FCA and often considers that a consumer is not in a position to sign away their rights. Especially as vast numbers of complaints see the consumer have a sudden change of mind about their experience and knowledge and claim the IFA told them to do that way and they just accepted what the IFA said.

Many PI insurers will not allow the IFA to transact DB transfers on an insistent client basis and many providers will not accept a DB transfer in unless the advice was positive.

n IFA can provide a report confirming his advice, he can ask that it is signed in blood to indemnify him, etc, etc. There are countless ways for the IFA to protect himself and ensure the client carries the risk.

The FOS disregard disclaimers as the consumer is not in a position to waive away their rights in areas that they have no understanding about.

As far as I am concerned, the decision is made and I don't actually need advice. I'm being forced to take it at considerable cost to me, which essentially lines the pockets of those the FCA are supposed to protect us against.

The FCA is not there to protect you against IFAs. What on earth made you think that?

IFA's quite rightly have a bad reputation as they make careers from preying on people's vulnerabilities by making things appear more complex than they are and lining their pockets in the process.

IFAs actually have a very good reputation. FAs generally tend to be the letdown. With your attitude though, I can see many IFAs telling you they are not interested just because of that.

Your posts suggest that you don't understand the risks and complexities what you are doing and that is why the FCA insists on this level of protection. If you cannot understand risk then how can you self invest?

freddymoney

1.5K, possibly 2K if they can convince me they are worth it.

RADDERS

I have just transferred my DB pension through as IFA and the charge was 1.5% of the pot with an ongoing charge of 0.5%

Now even though I worked in the financial industry for 30 years I was very unsure if to do this or not, I had at least 5 meeting with the IFA and all over it took approximately a year to sort out, mostly because I was trying to read up and ensure that I was doing the right thing.

I read the pension forum quite a lot whilst all this was going on I also asked questions on here to ensure that I was confident with the transfer.

Every persons needs and wants are different so when the IFA has to produce a report it is exclusively tailored for you and that is not a two minute job, they also have to evaluate the DB scheme that you are thinking of leaving. In my own circumstances the advisor did recommend the transfer and it went through and as I have no experience of investing I am letting the IFA sort it for me.

Aegis

freddymoney wrote: »

1.5K, possibly 2K if they can convince me they are worth it.

Well, at least you have a starting point for your negotiation.

If it was me, I'd end the meeting as soon as you mentioned your upper value. What you're stating isn't a fair price at all.

dunstonh

1.5K, possibly 2K if they can convince me they are worth it.

Given the extra risks you bring with you, that is not a reasonable fee.

freddymoney

what risks do I have, please enlighten me?

HappyHarry

freddymoney wrote: »

1.5K, possibly 2K if they can convince me they are worth it.

£2,000?

For advising an insistent client on a DB transfer?

I wouldn’t be trying to convince you. I’d be trying to get rid of you.

Sorry, but you are being unrealistic.

freddymoney

I rest my case

http://citywire.co.uk/new-model-adviser/news/contingent-charging-criticised-amid-db-transfer-mis-selling-fears/a1006826

Oldskool90

dunstonh wrote: »

It should be. However, it isnt as simple as that.



The FCA also tells advisers that they should not carry out transactions that they know to be wrong.

I am not asking them to carry out a transaction, but to simply provide advice one way or the other.


Many PI insurers will not allow the IFA to transact DB transfers on an insistent client basis and many providers will not accept a DB transfer in unless the advice was positive.

from what I am reading we are heading towards a situation where the public is not free to do with their investments as they wish.


The FOS disregard disclaimers as the consumer is not in a position to waive away their rights in areas that they have no understanding about.

as above....so I am now permitted to only invest where an IFA thinks I should?

The FCA is not there to protect you against IFAs. What on earth made you think that?

Experience with IFA's in the past


IFAs actually have a very good reputation. FAs generally tend to be the letdown. With your attitude though, I can see many IFAs telling you they are not interested just because of that.

Only in your mind do they have a good rep. I think all of them would see past my attitude to get their hands on the thousands they are quoting me.....

Your posts suggest that you don't understand the risks and complexities what you are doing and that is why the FCA insists on this level of protection. If you cannot understand risk then how can you self invest?

I've been self investing for years in stocks and shares and my returns have far exceeded any fund, endowment, etc that an IFA has steered me towards. I stopped using IFA's years ago. Cut out the middle man, do some research and spread risk...it isn't rocket science...especially when you consider most IFA's have done a few hours mickey mouse courses with a multiple choice exam to give them the highly impressive DipPFS after their name....sadly that probably actually impresses some people...

HappyHarry

freddymoney wrote: »

I rest my case

http://citywire.co.uk/new-model-adviser/news/contingent-charging-criticised-amid-db-transfer-mis-selling-fears/a1006826

Did you read the first sentance of that link?

Advisers have raised concerns about the contingent charging model for defined benefit (DB) transfer advice with many worried it leads to conflicts of interest for IFAs when they give advice, laying the ground for another mis-selling scandal.

Not the FCA, not clients, not the FOS, but advisers. Yes, good advisers are raising concerns about contingent charging. As they should.

If you think you don’t like bad advisers, that is nothing compared to how good advisers feel about them.