DB advice

PT48

Hi
Looking for a bit of guidance. I have a deffered DB pension due to start at age 62 paying 13k a year but have protected pension rights to start at 50 if i need it. I currently 48 and have just received a transfer value of £540000 to transer it if i want to.
The reason I enquired about moving is me and my partner are not married and DB scheme has told me that should anything happen to me it would be at trustees discretion if she received anything at all.


I also have a DC pension with my current employer worth £35k



Also was looking to purchase a property abroad at some point.


My DB scheme tax free lump sum at 50 is around 40k and 6k per year pension.


Some of the calculators on various sites are saying if i transfer out then my tax free lump sum at 55 would £135000 then rest into drawdown.


I am not very clued up on pensions


Any Advice ?


Should I transfer ?

want_to_save

I am not marreid to my partner but we been together for 20 years. He has put an expression of wish with his deferred db scheme that if he passes it comes to me.



I personally would not transfer

PT48

I also put expression of wish but there reply was still same. Trustees Discretion

xylophone

How about getting married?:)

https://www.royallondon.com/about/media/news/2018/may/five-good-reasons-to-transfer-and-five-good-reasons-not-to-royal-london/

pip895

When do you want to retire?

On the face of it the transfer value is generous - however you would need to get expert advice to work out if it really is a good deal.

The poor death benefits of my DB scheme were one of the reasons I chose to transfer in the end. I am also happy managing my own portfolio, am relatively risk tolerant and have other income. Even so it wasn't black and white. If my DB pension was fully index linked rather than caped at 5% I probably wouldn't have transferred.

The cost of transferring a pot of that size will be something over 1% of the pot size. If you decide to look into it further, go into it with an open mind and go for an advisor you trust to do a thorough job rather than necessarily the cheapest quote. My advisor saved me many thousand more than his fee by spotting discrepancies in the figures given by the pension administrator.

Takaty

I would suggest finding the exact definition of a Dependant in your DB scheme's Rules. It may state an adult dependant would need to be financially dependent or interdependent on you at date of death. This can usually be demonstrated by providing joint household bills, council tax bills etc. Alternatively the Rules might be vague and you may feel that you are at the mercy of the trustees.

If you are considering transferring you will need to seek independent financial advice from a regulated pension transfer specialist. If you are considering the effect of your death on your dependants you may wish to ask that you look at other options as well for example life insurance policies and how to best to use other assets you might hold.

Brynsam

xylophone wrote: »

How about getting married?:)

My sentiments exactly...to a point.

OP, if you are considering getting hitched, check the rules (and I do mean rules, not just the scheme booklet) of the scheme to see what the definition of 'spouse' is. Some schemes only pay full spousal benefits if the marriage takes place while someone is an active member of the scheme i.e. still building up benefits. The administrators of the scheme should be able to send you the relevant extract from the Trust Deed & Rules.

kidmugsy

PT48 wrote: »

I currently 48 and have just received a transfer value of £540000 to transer it if i want to. ....

My DB scheme tax free lump sum at 50 is around 40k and 6k per year pension.

By giving up £6k p.a. of pension you are rewarded with over half a million smackers? Why are you hesitating? Even if a market crash reduces the £540k to £300k it's still fifty times the £6k.

In your shoes I'd check the numbers again - surely these can't be right?

HappyHarry

If you transfer, you will lose the right to access your pension at age 50 and will have to wait until at least age 55, possibly 57.

The only way around this would be to find another deferred member who is then advised to transfer to the same new provider as you. (Buddy transfer). Even then, most pensions don't accept protected retirement ages, so you would be restricting the options available.

PT48

kidmugsy wrote: »

By giving up £6k p.a. of pension you are rewarded with over half a million smackers? Why are you hesitating? Even if a market crash reduces the £540k to £300k it's still fifty times the £6k.

In your shoes I'd check the numbers again - surely these can't be right?

6k is the reduced pension from 50 years old ( protected pension age ) Full pension is 13k from 62yo. Still a very generous CETV in my opinion

PT48

HappyHarry wrote: »

If you transfer, you will lose the right to access your pension at age 50 and will have to wait until at least age 55, possibly 57.

The only way around this would be to find another deferred member who is then advised to transfer to the same new provider as you. (Buddy transfer). Even then, most pensions don't accept protected retirement ages, so you would be restricting the options available.

I didnt have any intention to start drawing pension at 50 as I am fit and healthy and in full time employment so can wait until 55