Transfer DB pensions to private pension?

WoB

Marcon wrote: »

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.

Appreciate that, especially when you're talking larger amounts. But remember that a lot of people coming for advice / thoughts don't realise this, hence why you get the same question asked.

Thrugelmir

WoB wrote: »

I'm a medium/high risk investor.

I doubt you'll be in retirement. Protecting capital and having guaranteed sources of income are keystones of a secure financial retirement. As the figures stand strikes me that you are some way off having money to risk at the current time. Risk in all it's facets is a double edged sword. Potentially higher returns however correspondingly bigger losses.

WoB

Thrugelmir wrote: »

I doubt you'll be in retirement. Protecting capital and having guaranteed sources of income are keystones of a secure financial retirement. As the figures stand strikes me that you are some way off having money to risk at the current time. Risk in all it's facets is a double edged sword. Potentially higher returns however correspondingly bigger losses.

That's true. My risk level was referring to this present moment. Obviously this would be different come retirement or even approaching it.

ChuckMountain

WoB wrote: »

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

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

Did you get an actual transfer value for the EDS one as they charge you if you do two in a 12 month period and it's only valid for 3 months.

I am in a similar boat but possibly looking at transferring to another DB pension. Have yet to ask for a transfer value yet.

Silvertabby wrote: »

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 around 23 times the value of the pension which, I guess isn't as good as some but better than the 20 times they use for LTA calc on the forms. Even when they tried to get people out they were only offering a 5% uplift on the transfer value. I guess its take it or leave it though

WoB

ChuckMountain wrote: »

Did you get an actual transfer value for the EDS one as they charge you if you do two in a 12 month period and it's only valid for 3 months.

I am in a similar boat but possibly looking at transferring to another DB pension. Have yet to ask for a transfer value yet.

Yes, I got a written statement and separate transfer value. That's why I wanted to see if I should do something with them now to save a fee if applying outside of the 3 months (or having to wait another year).

For me it looks like I will hold it (maybe get another transfer value when I'm 55).

kidmugsy

You can't transfer the first (NHS) and perhaps shouldn't transfer the other two. Together they are likely, added to your eventual State Pension, to be about enough to use up your Personal Allowance against income tax. To have that much in guaranteed index-linked income is pretty desirable. It's a good diversification from the investment risk in your DC pension.

Suppose that at age 55 your DC pension value has fallen to £200k. What would you do then? Work on? Suppose it had risen to £350k: would you sell most of the high-risk investments and depend more on lower risk investments while you are drawing down before State Pension Age?

Have you checked the official prediction of your eventual State Pension?

It's pretty likely that your best bet is to draw each of them at their normal scheme retirement age, and use your DC pension to fill the gaps between age 55 and 60, 65, 67. But that depends on your health, marital status and wife's own pension provision, expenditure plans, and so on, plus the exact index-linking deal they offer. It also depends on the annual "actuarial reduction" that the schemes apply for drawing your pension early: if it's unusually small it might be worth drawing them early. "Unusually small" might mean less than 4% for each year early. If it's over 5% you'd probably not want to draw early.

blisteringblue

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!

Behave, there are plenty, transferred out of 2 myself. One at 39x and the other at 56x and I can now retire in 4 years quite happily because of them.

WoB

kidmugsy wrote: »

You can't transfer the first (NHS) and perhaps shouldn't transfer the other two. Together they are likely, added to your eventual State Pension, to be about enough to use up your Personal Allowance against income tax. To have that much in guaranteed index-linked income is pretty desirable. It's a good diversification from the investment risk in your DC pension.

Suppose that at age 55 your DC pension value has fallen to £200k. What would you do then? Work on? Suppose it had risen to £350k: would you sell most of the high-risk investments and depend more on lower risk investments while you are drawing down before State Pension Age?

Have you checked the official prediction of your eventual State Pension?

It's pretty likely that your best bet is to draw each of them at their normal scheme retirement age, and use your DC pension to fill the gaps between age 55 and 60, 65, 67. But that depends on your health, marital status and wife's own pension provision, expenditure plans, and so on, plus the exact index-linking deal they offer. It also depends on the annual "actuarial reduction" that the schemes apply for drawing your pension early: if it's unusually small it might be worth drawing them early. "Unusually small" might mean less than 4% for each year early. If it's over 5% you'd probably not want to draw early.

Hi and thanks for your thoughts.

Predicted state pension for 2036 :eek: is £8575. I'm pretty flexible on the working front, it's not like I hate my job! As such, I am happy to remain invested during any slumps and await a revival!

I have ISA investments etc. also which can act as top up's or alternative income should this be necessary or keep working etc.

My wife has a £100k pot in her pension and is 54. We are looking to assess things in a year to determine where we're at and what we need to do. I have a decent paid job so I am using this time in our lives to bank/invest as much as possible while I can.

On the DB pensions, I think I will leave them and incorporate their figures into a timeline for our future income. It will help work out 'the number'. It also gives me one thing less to worry about!

Thanks for your input. :beer:

BJL55

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!

I did and I have and I'm far from being unique from my company (3 years to SP).

But ....... we have an index linked pension floor (including SP's) of 22K and an additional 100K pot, mortgage free and no debt.