Transfer out of Final Salary Scheme

kidmugsy

OP, your scheme seems rational to me for the reasons Daniel 54 summarised. So my only addition is a minor one; if your husband does not pay income tax he can transfer his unused Personal Allowance to you, I believe. But maybe you've done that already.

Retiring1

Thanks kidmugsy, yes, already have transferred some Personal Allowance

Retiring1

Just a quick update. I have talked with 2 IFAs, both helpful and understanding and on info provided so far (as above) likely to recommend a transfer in these circumstances. I am trying to decide which one to proceed with, it will probably come down to location and cost. 1% of CETV seems common. I have asked for more info from the scheme (scheme rules etc) to try and get ahead of the game bearing in mind the scheme admin has been v slow so far. Thanks for all your help.

Retiring1

I have made some progress with the transfer of my Final Salary Benefits, as previously discussed.

I now need to agree the transfer, together with the initial investments. I've received the paperwork and am studying it, prior to a meeting next week. My attitude to risk came out as an 8, which I downgraded to a 7, High Medium. The suggested funds (on Fidelity Funds Network at a charge of 0.1%) are as follows

Baillie Gifford Emerging Mkts Gr B Acc 10%
Baillie Gifford High Yield Bond B Acc 4%
Baillie Gifford UK Equity Alpha B Acc 9%
Baring Eastern GBP Inc 5%
Fidelity Em Mrkts W Acc GB 8%
Invesco Asian UK Y Acc 7.5%
iShares Continen Eurp Eq Idx (UK) D Acc 2.5%
L&G Multi Index 7 I Acc 7.5%
L&G UK Property I Acc 5.5%
LF Lindsell Train UK Equity Acc 11%
Lion Trust Special Situations Inc 6%
Man GLG Japan CoreAlpha Profl Acc C 5%
Merian UK Smaller Cos U1 GB Acc 11%
Royal London Ethical Bond M Acc 4%
Vanguard US Equity Index Acc 4%

So 15 different funds, which is probably more than I would use myself as I would want something more simple to monitor. But do any of you kind experts have any comments to make?

I will also be asking about the fees, which are as follows (I don't understand the Policy Fee at all)

Fund charge .73%

Policy Fee

£22.50 applied twice annually in advance, increasing at 0% starting from the outset until the fund level reaches £100,000
0.25% applied monthly in advance starting from the outset until the fund level reaches £100,000
0.15% applied monthly in advance starting when the fund level exceeds £500,000 until the fund level reaches £1,500,000
0.2% applied monthly in advance starting when the fund level exceeds £100,00 until the fund level reaches £500,000
0.1% applied monthly in advance starting when the fund level exceeds £1,500,000 until the end of the contract

Initial Adviser Charge £5,200 (agreed)

Ongoing Adviser Charge 0.5% of the fund value paid monthly (agreed)

I'd be really grateful for any comments, or pointers as to what further questions to ask at my next meeting

Very many thanks

Albermarle

The normal retirement age is 65, if I take it now (as I would like to do, wishing to travel more while we are able) it will be £15,200pa if I don't take a lump sum, with indexation up to 5% and a half pension for my husband were I to die first. The transfer value is £468k.

The CETV looks quite generous . My DB is projected to pay a similar sum but at 65 , not 2 years earlier and I was offered £475K . I thought that was quite good but following the usual general advice on these matters and my own circumstances , I did not take up the offer .

dunstonh

So 15 different funds, which is probably more than I would use myself as I would want something more simple to monitor. But do any of you kind experts have any comments to make?

10-15 is the common range. The higher the value, the more you may get to spread the investment (for FSCS and a bit more micromanagement)

Retiring1

Albermarle wrote: »

The CETV looks quite generous . My DB is projected to pay a similar sum but at 65 , not 2 years earlier and I was offered £475K . I thought that was quite good but following the usual general advice on these matters and my own circumstances , I did not take up the offer .

Thank you. It is a big step for me, as I have always preached the benefits of Final Salary Schemes, but my experience with the PPF, my concerns about the increasing deficit in this scheme and my own personal circumstances make me confident that this is the right step. Doesn't make it easier to do though, so I am very grateful for the time given by the experts here.

Retiring1

dunstonh wrote: »

10-15 is the common range. The higher the value, the more you may get to spread the investment (for FSCS and a bit more micromanagement)

Thank you. Do you have any comment on the fees please?

Retiring1

I should add that my plan is to use some of our cash savings to supplement our income (Pay for holidays!) over the next 3 years, giving the pension pot some time to grow, while also adding £2880 per annum. I would then expect to start taking some funds (unless there has been a significant dip) probably at 3% pa

dunstonh

Retiring1 wrote: »

Thank you. Do you have any comment on the fees please?

0.5% p.a. is the dominant figure charged by IFAs. The initial is good for a DB transfer (see other threads where two or three times that is common).