Who will accept a DB to SIPP transfer from "insistent client"

zAndy1

I've been deliberating about going down this route with a couple of DB pensions I have , they aren't massive amounts compared to some of the life changing amounts I've seen mentioned but I can't help thinking I'd be better off transferring them due to my circumstances. I'll summarise and keep it fairly brief , I'm 53, one of my deferred DB pensions is payable from 65, I was only in the scheme for 3 years and it was my first job when I graduated 30 years ago. Current projected annual pension £2200pa, no annual increases under the scheme rules , CETV £54000. Second deferred DB pension is payable from age 60, member for 7 years current value of annual pension payable £5400pa , CETV £184000. 
The reasons I have been looking into this are personal and financial. My brother died suddenly of a heart attack at the age of 48 a couple of years ago , that had a huge effect on me and obviously made me think more about my own mortality and the financial implications should the same thing happen to me. I've made great strides to improve my own health in the last couple of years, lost about 3 stone and don't have any serious medical issues although I do take tablets for high BP and high cholesterol. I don't like the thought of me dying if not before retirement then not long after and all that money that could be passed on to my family going up in smoke. I am not averse to investing money how I see fit , indeed I have been more proactive with choosing the funds my current DC pension invests in than anyone else I'm aware of where I work and have accumulated a fund worth almost £100k in the last 10 years a lot of which has been as a result of my choice of investment funds as opposed to leaving them in the default ones. Again not a huge amount but I've only personally contributed about £30k into that fund (matched by my employer) so I'm happy with how it's doing. Anyway I digress , the main reasons I guess for me wanting to go down this route is that I have a lot of personal debt (£50k ish unsecured) and a mortgage being paid back on an interest only basis with about £160k outstanding and 12 years to run. For those reasons alone I see being able to access 25% of what is likely to be £250k ish (so just over £60k) at age 55 at the end of next year as something that would improve my situation from age 55 immensely and I put far more importance on that than any amount of pension I might be able to take from age 60 or 65. That might seem short sighted but for me just having no unsecured debt would be a huge relief. Apart from the 2 DB schemes I've mentioned I have DC schemes with a current combined value of £130k , likely to be £230k by age 60 all being well and my wife has projected annual pensions of approx £15k pa at age 65. 
The CETV value for the pension payable at age 60 has increased significantly over the last few years, I guess another question is how likely is that to stay at a multiplier of around 35x as it is now or might it reduce over the next couple of years as it probably makes sense to leave it until I'm 55 before I do anything seeing as I wouldn't be able to touch it until then anyway. Also does the fact the smaller deferred pension that isn't subject to any annual increases once it's in payment make that a good candidate to transfer? Personally I think it's a very good reason to transfer it but due to the amount being relatively small it's highly unlikely I'll find anyone willing to even look at it although perhaps if I got someone to look at both at the same time that might help. 
From what I've said (apologies it turned into a bit of an essay in the end) does it sound like it would be worth me looking into this further? I just can't help thinking £5.5k pa vs £184k now for someone in my position financially makes it a bit of a no brainer , thoughts? Ta

Albermarle

Just a couple of thoughts .
The cost of paying a guaranteed income linked to inflation for 35years is usually seriously underestimated . The inflation proofing makes a big difference as you can see from the lower CETV offered for the non inflation linked pension.
If you were to buy an annuity in the open market for a £5.5Kpa inflation linked pension starting at age 60 , it would probably cost more than £200K .
Having a mixture of a DB and DC pensions is often said to be the ideal place to be . To go 100% DC/investment based is a big decision.

zAndy1

Albermarle said:

Just a couple of thoughts .
The cost of paying a guaranteed income linked to inflation for 35years is usually seriously underestimated . The inflation proofing makes a big difference as you can see from the lower CETV offered for the non inflation linked pension.
If you were to buy an annuity in the open market for a £5.5Kpa inflation linked pension starting at age 60 , it would probably cost more than £200K .
Having a mixture of a DB and DC pensions is often said to be the ideal place to be . To go 100% DC/investment based is a big decision.

That's a rather big assumption to make that I'll live to 95 though but I take your point. Frankly I probably won't care two hoots how much pension I get by the time I'm 80 , I most likely won't be able to enjoy it anyway and would therefore much rather be able to enjoy the 20 years from 60 to 80 with a much higher income. I don't like assuming anything in light of what happened with my brother and effectively only having access to half a pot from the age of 60 based on an assumption I'll live till I'm 95 doesn't sit well with me one bit. With my wife's pension and our combined state pensions we're looking at around £30k pa there without my deferred DB pensions so I feel I have scope to use those to 'front load' my retirement income if need be..
Appreciate you taking time to post your thoughts and yes I agree it's a big decision...

Albermarle

zAndy1 said:

Albermarle said:

Just a couple of thoughts .
The cost of paying a guaranteed income linked to inflation for 35years is usually seriously underestimated . The inflation proofing makes a big difference as you can see from the lower CETV offered for the non inflation linked pension.
If you were to buy an annuity in the open market for a £5.5Kpa inflation linked pension starting at age 60 , it would probably cost more than £200K .
Having a mixture of a DB and DC pensions is often said to be the ideal place to be . To go 100% DC/investment based is a big decision.

That's a rather big assumption to make that I'll live to 95 though but I take your point. Frankly I probably won't care two hoots how much pension I get by the time I'm 80 , I most likely won't be able to enjoy it anyway and would therefore much rather be able to enjoy the 20 years from 60 to 80 with a much higher income. I don't like assuming anything in light of what happened with my brother and effectively only having access to half a pot from the age of 60 based on an assumption I'll live till I'm 95 doesn't sit well with me one bit. With my wife's pension and our combined state pensions we're looking at around £30k pa there without my deferred DB pensions so I feel I have scope to use those to 'front load' my retirement income if need be..
Appreciate you taking time to post your thoughts and yes I agree it's a big decision...

The average man retiring at 60 will live on average 25 Years , which means 50% will live longer . If you have money and a family and no really bad habits then you might well be in that 50% . For a couple the chance one will still be alive at 95 is about 25% .
This idea that people 80 years old stop spending is not correct. Spending priorities may change towards items that help with coping with old age but also many 80 year olds enjoy holidays , new cars etc Or even a comfortable care home if it comes to that .
With my wife's pension and our combined state pensions we're looking at around £30k pa there without my deferred DB pensions
For sure the more fixed/guaranteed income you have coming in , it reduces the risk of giving up some of it .

Durhamborn

First i dont blame IFA's for handing out not to transfer mostly as the regulator and insurance are a pigs ear.For me the client should choose if they want to transfer without having to pay huge fees,though again not the IFAs fault.
The way to do it though is go to a decent sized local IFA and tell them youd like to look at a transfer and for them to manage the money and then the drawdown pot later.That way the IFA thinks they are getting the fee plus the yearly ongoing fleece/fee.They will then usually say dont transfer,but if not reckless they will wink wink insistent client.In the meantime without telling them open a Sipp.Most tend to use the platform Transact so ask for the log in details to check the value etc.As soon as you see the cash land in the account launch a transfer into your Sipp.Most of the big ones use Origo and the transfer will go quick as the funds will be in cash.At the same time email or deliver a letter to the IFA telling them to leave as cash because you have decided to transfer to your own Sipp.That way it stops them investing before the money moves.
Job done.
Thats how i did mine,and how several friends/family got theirs done.
Crazy,but its the system we have.Decent IFA's shouldnt have to carry all the risk and people should be able to transfer with no advice or perhaps have to attend a course etc for a few hundred.

Thrugelmir

Durhamborn said:

Crazy,but its the system we have.Decent IFA's shouldnt have to carry all the risk and people should be able to transfer with no advice or perhaps have to attend a course etc for a few hundred.

That's what happens when there's an extended bull market run. Complacency grows to higher and higher levels. As if investing to make money is like picking apples off trees. Then when it all goes wrong those who lose out will expect to be compensated. 

TVAS

OMG Insistent customer a decent adviser would refuse to do the business and walk away so he is not liable at all. 
I have only ever seen one insistent customer who gave a convincing rationale why he wanted to go against the advice NOT to transfer. It was 4 pages and quite brilliant.  

Your employer wants you and other members to leave the scheme because it is bloody expensive and whatever you pay they pay a hell of a lot more. 

You have not said why they have recommended against and you have not said why you wish to transfer. You have not mentioned your age or when you intend to retire. The factors mentioned above, flexibility to cope with redundancy, transfer values are poor reasons because the event has not yet happened and the transfer value is likely to increase over time because the benefits the value secured are higher (pension revalues) and we have super low gilt returns.  So you seem to be transferring for vague reasons i.e. the transfer drivers are not strong enough to warrant a transfer from a DB pension.  

Nobody recommends Stakeholder any more they are expensive, limited funds and require another transfer to a drawdown plan so pointless.  A competent professional person would even mention a Stakeholder.

If I were you you I would get a quote from an annuity provider, so in put the pension at retirement age, change your date of birth to that retirement age, put in the rate of increase and see the amount of money you need to buy the pension you are giving up. I bet the amount is higher than your transfer value. However you seem to want to narrow your options at this juncture instead of waiting until you at least want to take benefits which will be a comparison of the scheme pension with a drawdown or annuity pension. So If I was reviewing your case I would fail it on suitability but I may not recommend you have compensation because I may deem that you would have transferred anyway. I have just been on a contract where the transfers took place as late as 2019. Large transfer values. One case the transfer was £1,000,000 we had to pay £500,000 compensation. 

Lastly one has to remember that the default position is not to transfer from a DB scheme and you do not seem to have a good reason for doing so at this juncture.

omelettesandeggs

Quick update from our transfer:
I found an IFA willing to give us advice at the end of Dec 2020. The IFA was Cobens wealth management who have been very prompt and helpful. They were able to provide a positive recommendation to transfer my DB into a SIPP based largely on my need to have the ability to invest my pension in suitably ethical funds / companies. The advice and transfer cost £3250 in total. Transfer has been actioned within the 3 month CETV deadline. 

If they couldn't provide a positive recommendation then our back plan was to transfer the DB pension into a youinvest SIPP with AJ Bell (no initial fees) and then onto our SIPP provider of choice (investacc).

[Deleted User]

IFA Wealth Managers .

Rather blurs the GoodIFA/BadFA narrative but, if Cobens comes recommended for good work, take note, because once you have transferred, transferring again should be easy.

Good luck, omelettesandeggs.

squirrelpie

I'm curious. I was interested enough to go find the Cobens wealth management website https://www.cobenswealth.co.uk/ and from their about us page I followed to check their registry entry https://register.fca.org.uk/s/search?q=484450&type=Companies but I was very surprised by what it says:

We’ve found 1 firm matching 484450

Astute Financial Management UK Ltd

Reference number: 484450

Now the contact email given for Astute is chris.poole@cobens.co.uk so apparently there is some connection, but I always think that in connection with financial companies and registrations we should be very picky about the spelling of names etc. No?