Transfer DB pensions to private pension?

WoB

I have 3 defined benefit pensions from previous jobs. Contributions were small and I only worked at these companies for a few years each.

With the rise in transfer values I asked each for current status + a transfer value.

Below are some rough details:

Pension 1 - Current annual value = £420 (compulsory lump sum £1260). Normal pension age is 60. This is an NHS pension from 1985-1987. I have requested a transfer value but I'm not sure you can transfer out of an NHS scheme?

Pension 2 - Current annual value = £1645. Normal retirement age is 65. Estimated annual pension with growth = £2900. Transfer value = £39000.

Pension 3 - Currrent annual value = £960. Estimated annual pension with growth = £760 (@55) and £1180 (@60). Transfer value = £18800.

I'm 49 and looking to retire at 55. What's your gut feel on whether these are decent transfer values? I'm a medium/high risk investor.

I'm thinking with the small potential annual pensions involved I'd be better off taking the transfer values and adding to my private pension, which currently has a value of £277k.

Is it in the ballpark to make it worth an IFA reviewing?

Can I transfer the NHS pension anyway or am I stuck with that and whatever it brings?

Pension 2 is an EDS pension - not sure I can take this before 65 as the statement only references this age. Anyone know?

Silvertabby

Your NHS pension can only be transferred to another DB scheme, so you are likely only looking at other public sector schemes.

The transfer values for pensions 2 & 3 are very poor value indeed. 'Good' would be 35 to 40 times the annual pension given up.

It's likely (but you'll need to check) that you will be able to take your EDS pension from 60, subect to an actuarial reduction for early payment. The 3 pensions together will give you a decent enough supplementary income from age 60 if you leave them where they are.

Someone will almost certainly be along with other ideas re pensions 2 & 3, though.

k6chris

Flip the question around and ask how many people on this forum would pay you those transfer values in return for an index linked, no-risk, probably with on-going benefits to an other half, DB pension....? Safe to say you would have a very,very, very long queue. In fact, let me start that queue!!!

Blackbeard_of_Perranporth

I have yet to meet anyone who has a DB scheme wishing to transfer out, but you are quite welcome to be the first!

NoMore

Blackbeard_of_Perranporth wrote: »

I have yet to meet anyone who has a DB scheme wishing to transfer out, but you are quite welcome to be the first!

Your not round here much then, there's at least two or three threads a week asking about it!

WoB

Appreciate the quick responses and feedback. It looks like the concensus is to leave them where they are. I just they were small amounts and it would maybe better to consolidate. Was also thinking about death benefits and the 50% reduction etc.

Always good to get opinions from others though, especially when they know more about a subject! :-)

@Silvertabby - I will enquire about the earlier retirement age with EDS. I may just leave this to 65 come the time but good to know and have options.

Thanks again!

WoB

NoMore wrote: »

Your not round here much then, there's at least two or three threads a week asking about it!

I appreciate it's possibly often asked but I would think each case should be taken on it's own merit and not all DB transfers should be dismissed out of hand?

greenglide

According to the EDS pension scheme booklet (assuming it is the true EDS scheme, rather than the EDS 1994 scheme for outsourced public sector workers) you can retire at any time after age 55 subject to reduction of around 4%pa :-

If you have left the Plan and so no longer contribute to it, you can retire anytime after your 55th birthday (if you are in ill health you may be able to retire earlier, subject to Company and Trustee approval and to legislation requirements).

See here for scheme details.


http://hp-eds.xpmemberservices.com/


Most of EDS in this country was taken over by HP and then was spun off as HP Enterprise Services most of which merged with CSC to form DXC technology. DXC is currently the sponsoring employer.



The scheme is now closed, even to existing employees but HPE and CSC paid huge sums into it as part of the merger and it is fully funded. Because of this you should think very hard before transferring out of the scheme.

NoMore

WoB wrote: »

I appreciate it's possibly often asked but I would think each case should be taken on it's own merit and not all DB transfers should be dismissed out of hand?

I made no comment on whether you should transfer or not, only that blackbeard seem to think it was unusual, which as I said its not, with the amount of threads asking similar.

Marcon

WoB wrote: »

I appreciate it's possibly often asked but I would think each case should be taken on it's own merit and not all DB transfers should be dismissed out of hand?

Yes, but those posting questions never give anything like enough information for those merits to be considered. It's often the small details which matter more than the headline numbers.

WoB

greenglide wrote: »

According to the EDS pension scheme booklet (assuming it is the true EDS scheme, rather than the EDS 1994 scheme for outsourced public sector workers) you can retire at any time after age 55 subject to reduction of around 4%pa :-


See here for scheme details.


http://hp-eds.xpmemberservices.com/


Most of EDS in this country was taken over by HP and then was spun off as HP Enterprise Services most of which merged with CSC to form DXC technology. DXC is currently the sponsoring employer.



The scheme is now closed, even to existing employees but HPE and CSC paid huge sums into it as part of the merger and it is fully funded. Because of this you should think very hard before transferring out of the scheme.

Thanks for your input. I worked there 93-97 but only became eligible to join the fund in 94. The statement refers to ELECTRONIC DATA SYSTEMS (EDS) RETIREMENT PLAN. It's becoming quite clear that I should leave the money in each fund. Once again, many thanks!