Pension Transfer fee

DairyQueen

Norbvan wrote: »

Removed by Forum Team

AnotherJoe is simply illustrating reality in an imaginative way.

The actuaries who calculate IFA insurance premiums are very cold-blooded. They couldn't care less if your spouse is in the minority. They are much more interested in the majority who will make a combo claim on the slightest pretext.

The bottom line is that you cannot transfer out of a DB scheme without taking independent advice from a pension specialist. The specialist will advise against transferring in 90% of cases (for good reasons). Most pension providers will not accept transfers without a positive recommendation from an IFA.

I am in the minority who received a positive recommendation. My circumstances are very specific:

- I have reduced life expectancy
- I have no dependent children and wish to leave any unspent pension as an inheritance for my nephews
- my spouse does not require a widow's pension from my (ex) scheme (he has ample pension provision)
- I have experience as a DIY investor
- we have sufficient guaranteed income from other sources to fund non-discretionary expenses.

This list isn't exclusive but illustrates the type of profile required to receive a positive recommendation. I doubt that your spouse can muster a similar set of unusual characteristics and, if he can't, then he shouldn't be transferring, and the law is designed to protect people just like him.

HappyHarry

xylophone wrote: »

I was looking at this (but from last August)

https://citywire.co.uk/new-model-adviser/news/biggest-advice-firms-commit-to-db-transfer-market-amid-pi-jitters/a1144002

Minds changed?

The PI companies have been unnerved by the hike in the FOS compensation limits, so I understand.

Thrugelmir

DairyQueen wrote: »

- I have experience as a DIY investor

Purely as an observation. Overconfidence is an investors worst enemy. Resulting in people overestimating their own ability and believing that they are better than the average. When the majority of the time their good fortune is down to luck.

dunstonh

It wouldn't surprise me if your husband's adviser has had his insurance for this type of work cancelled in the last couple of days. Many advisers have just faced this issue.

Good chance of that. Estimates are that at least of a third of the adviser firms are with the PI insurers that have said they will not insure DB transfers transacted after 1st April.

DairyQueen

Thrugelmir wrote: »

Purely as an observation. Overconfidence is an investors worst enemy. Resulting in people overestimating their own ability and believing that they are better than the average. When the majority of the time their good fortune is down to luck.

Over-caution is a worse enemy. At least the overconfident enjoy the possibility of (lucky) above-inflation gains.

coyrls

Norbvan wrote: »

Hi
My husband has a pension to the value of £158000 which he wants to take this year, it is in a defined pension at the moment and he wants to put it into a flexible pension. He does not need advice on how to do this as he fully understands the process.

The advice would not be on how to do the transfer, the advice would be on whether to do the transfer at all. The how is not the problem it's the why. He may understand the process but there is no pension type called "defined pension" and no pension type called "flexible pension", to demonstrate understanding, it would be a good idea to use the correct technical terms.

Silvertabby

“ Hi
My husband has a pension to the value of £158000 which he wants to take this year, it is in a defined pension at the moment and he wants to put it into a flexible pension. He does not need advice on how to do this as he fully understands the process.
Originally posted by Norbvan

A scenario/question. Your husband puts this £158,000 (less advice fees) into a SIPP. Overnight, the stock market tanks and he loses 20%. Would he just say 'oh well, win some lose some' or would he throw his teddies out? If the latter, then he probably needs to stay with his DB scheme.