Could anyone comment on taking a CETV who has done it??

SonOf

Given all the above and the fact that the DB pot has poor spouse provision unless the pension is actually in payment ( 65 is the nominated age) and the lack of inheritability we are seriously considering transferring the 800k out.

Do you have any experience with investing?
For example, an experienced investor will see the periods when they lose 15-30% (or more) of their value as just routine. Whereas others cannot handle losing even 1% of their value.

In your case, with £800k, that means seeing fairly regular drops in excess of £100,000. Can you handle that?

Linton

Socajam wrote: »

Just had to ask this question and not meaning to be disrespectful: but who in there right mind talks about buying their dream house at 60. Once you turn 50, its down hill all the way, with the hope that we reach retirement.
I attended the funeral of two friends within a matter of 4 weeks - at the age of 54 and 57.
I am 62, mortgage free and there is no way I would be thinking of looking towards buying any dream house -
more likely downside to something without stairs. I intend to work less and enjoy the fruits of my hard labour, that started at age 16.
There is no retirement nowadays because those of us who are this age are dying younger now. Some not even seeing retirement.

My experience is very different. I retired at 56 and bought our intended final house at 68. Now at over 70 I am still in pretty good health - no sgnificant signs of downhill. My hope/expectation is to live to have been retired for longer than I worked.



Where are the statistics to show that people are dying younger? The most they show is that the projections of a few years ago were over optimistic. The majority of males at 50 can still expect over 30 more years of life with about 5% dying in their 50s. Your experience of friends dying in their 50s must have been very unsettling, however this is not usual.

TBC15

I took the money and ran 2 ½ years ago, laughing all the way to the bank so far. My circumstances are probably reasonably unique, but the flexibility was a no brainer for me.

happyandcontented

Socajam wrote: »

Just had to ask this question and not meaning to be disrespectful: but who in there right mind talks about buying their dream house at 60. Once you turn 50, its down hill all the way, with the hope that we reach retirement.
I attended the funeral of two friends within a matter of 4 weeks - at the age of 54 and 57.
I am 62, mortgage free and there is no way I would be thinking of looking towards buying any dream house -
more likely downside to something without stairs. I intend to work less and enjoy the fruits of my hard labour, that started at age 16.
There is no retirement nowadays because those of us who are this age are dying younger now. Some not even seeing retirement.

I appreciate your intent, but at almost 60 we don't feel old!

The dream house will probably remain just that but we will move, because our current house will have increased access limitations for us going forward, as it is elevated and up 14 steps.

happyandcontented

Notepad_Phil wrote: »

You've not put down what this DB pension would actually pay out, but how about a thought from someone who has decided not to do it?

In my case I decided to stick with my DB pension because although there will be limited inflation proofing, I felt that as my wife has the greater likelihood of being the surviving partner then for my wife the higher the DB pension I could arrange the better it would be for her - though we do have quite a high DC amount already that she will have to look after.

Now I know that you've said that there is poor spouse provision until it's actually in payment, but are you completely sure about that?

I'm not yet receiving my DB pension, so I could still change my mind, but unless you're getting a really high multiplier for your CETV then I think you should be very careful to figure out what will be best for your partner when you're no longer around before transferring.

Yes, it is just the return of personal premiums until the pension is in payment.

happyandcontented

TBC15 wrote: »

I took the money and ran 2 ½ years ago, laughing all the way to the bank so far. My circumstances are probably reasonably unique, but the flexibility was a no brainer for me.

Would you mind explaining? If not, don't worry! It is the flexibility that has us prevaricating.

LHW99

Yes, it is just the return of personal premiums until the pension is in payment.

Have you considered whether you could use the lump sum to increase the pension paid, but take it early? That might reduce the effect of actuarial reduction, but ensure the index linking?
Would dependonthe scheme and amounts required obviously.

hyubh

arnoldy wrote: »

Remember that unless you are in a platinum gold and diamond encrusted public sector DB scheme you are not likely to be index linked.

That is false - post-88 GMP and post-97 excess has to be index linked by law. And there is a broad range of practices for pre-97 excess.

You are probably CPI linked up to a cap say 2.5%

That is the statutory minimum for post-05 excess. (The statutory minimum for 97-05 is CPI capped to 5%.)

- but only if the fund allows

Wrong, purely discretionary increases are possible for pre-97 excess only.

hyubh

Socajam wrote: »

There is no retirement nowadays because those of us who are this age are dying younger now.

False. From the ONS:

Life expectancy at age 65 years was 18.6 years for males and 21.0 years for females, with an improvement of 4.7 weeks for both sexes in comparison with 2015 to 2017.

https://www.ons.gov.uk/peoplepopulationandcommunity/birthsdeathsandmarriages/lifeexpectancies/bulletins/nationallifetablesunitedkingdom/2016to2018

bostonerimus

TBC15 wrote: »

I took the money and ran 2 ½ years ago, laughing all the way to the bank so far. My circumstances are probably reasonably unique, but the flexibility was a no brainer for me.

I'm also doing well with the CETV I took 5 years ago. It's growing by 8% a year so far and so actuarially I'm ahead of the DB pension. But there are so many unknowns and probably at least 25 years to go before I find out which was the most lucrative choice... and I'll be dead, so it's a moot question. There will be plenty of down years, but I'm sure I made the right choice, given my income requirements and circumstances, even if ends up not being the most lucrative. However, it's different for everyone.