PruFund Pension Cautious

bostonerimus

I worry when people with limited financial knowledge transfer out of define benefit plans and put their trust in an IFA. They will have to pay IFA fees and there will be no guarantee of investment returns or the quality of the advice given. Rather than requiring IFA advice on such transfers I'd like there to a requirement for people to pass a test of financial knowledge before they can do it.

zolablue25

bostonerimus wrote: »

I worry when people with limited financial knowledge transfer out of define benefit plans and put their trust in an IFA. They will have to pay IFA fees and there will be no guarantee of investment returns or the quality of the advice given. Rather than requiring IFA advice on such transfers I'd like there to a requirement for people to pass a test of financial knowledge before they can do it.

But the whole point of having specialists, in any field, is so that you don't need to learn everything about every subject in life.

Now, if the IFA can't be trusted to give you decent quality of advice then there is something wrong with the IFA system which should be fixed - not expect everyone to learn the ins and outs of the financial system before they can invest their money.

Ganga

John_30033 wrote: »

Absolutely correct. I really do appreciate people taking the time to respond to my question, but I can't help but be a little irritated by slightly condescending and unnecessary comments such as "Pru has charges. They dont do it out of love." plus absolutely no thought given to the possibility that there might be more reasoning for considering a transfer than simply getting a better return at retirement time.

You do not always get the answer you would like but the person who took the time to reply has an awfull lot of knowledge on the subject and gives help for nothing,do not knock it:T

bostonerimus

People should have enough knowledge to judge the quality of the advice given. The transfer of a DB pension is probably the most important financial decision most people are going to make and they should take the time to understand what's going on rather than just trusting to an IFA.

RADDERS

bostonerimus wrote: »

I worry when people with limited financial knowledge transfer out of define benefit plans and put their trust in an IFA. They will have to pay IFA fees and there will be no guarantee of investment returns or the quality of the advice given. Rather than requiring IFA advice on such transfers I'd like there to a requirement for people to pass a test of financial knowledge before they can do it.

Not sure if this is meant for me or not, but I worked in the finance sector for nearly 30 years so understand exactly what risks I am taking. But it is my call :A

Thrugelmir

bostonerimus wrote: »

The transfer of a DB pension is probably the most important financial decision most people are going to make and they should take the time to understand what's going on rather than just trusting to an IFA.

The IFA isn't making the decision though. Simply providing the options available. People may have any number of reasons to follow a particular course of action.

Fads come and go. As soon as the headlines report fingers getting burnt. Attention will be switched elsewhere. Until the next generation comes along. Life is cyclical.

bostonerimus

RADDERS wrote: »

Not sure if this is meant for me or not, but I worked in the finance sector for nearly 30 years so understand exactly what risks I am taking. But it is my call :A

No, my post was a general comment. I think people should have the freedom to do what they like with their money, but they also need the knowledge to make sensible decisions or at least to evaluate the professional advice they are given.

Whether a DB transfer is a good idea depends on many factors and circumstances. I have actually gone both ways.....I cashed out one small DB plan and also took a one time chance to buy into one because at age 53, a $280k lump sum payment got me an index linked $20k annual lifetime income starting at age 55.