Tax free 25%

john-306

tetrarch wrote: »

3% seems a bit steep.

I have seen tideway mentioned a few times on this forum, and they charge 1%

No experience but it might be worthwhile to shop around, even if it only serves as a negotiation point

Regards

tet

Rang loads up already, Tideway said they'd return call. They didn't.
Also found they tie you in for years.
I initially thought 3% was very high, but ringing around and actually finding anyone who will transfer, in my case it seems to be the level unfortunately.

SonOf

I initially thought 3% was very high, but ringing around and actually finding anyone who will transfer, in my case it seems to be the level unfortunately.

3% needs to be in context. 3% on £100k is fine. 3% on £300k is expensive. Many firms taper their percentage charge as the value goes up or they have a decency cap.

The transaction you want to is statistically more likely to be wrong than right. It is a current hot potato with the regulator under extreme focus. So, firms are treating it as a very high risk transaction and pricing it accordingly.

Albermarle

The reason I ask we've had a 3% quote for transfer out, if the 25% is taken the quote is just on the 75% remainder.
Another quoted 2.5% on the whole 100% transfer amount even if 25%

Just to go back to the original post . There seems to be an assumption that the transfer will get the green light and go ahead , which might not be the case . Will the charging structures detailed remain the same in that case ?

Andrew31

[QUOTE=
Some pension advisers will take their fee after you've taken your tax free cash out (that way you get the full 25% of the CETV) & some will ask for their fee to be deducted before you take your tax free cash (you get a little less tax free cash as you get 25% of what is left after their fee). Or you could pay their fee directly from your bank account instead of your pension.[/QUOTE]

Any advisers taken fees before PCLS are not good advisers. Client should insist on fees post crystallisation.

john-306

Albermarle wrote: »

Just to go back to the original post . There seems to be an assumption that the transfer will get the green light and go ahead , which might not be the case . Will the charging structures detailed remain the same in that case ?

We've had the green light yesterday and will be going ahead with the transfer.
The transfer specialist cost is 2.5%, all we rang around were in that ballpark.
Since early December 2019 the CETV value has dropped 10k, so ideally needed it to go through before end Feb to get the Dec figure.

Malthusian

john-306 wrote: »

Rang loads up already, Tideway said they'd return call. They didn't.
Also found they tie you in for years.

No adviser can tie you in, you are free to dispense with their services at any time.

There are some investments which would apply exit charges (notably SJP's, which nobody on this forum would use) but you are still free to pay them and leave.

I would echo the opinion that if an adviser charges a fee on tax free cash you should think twice; fees should be charged on money under advice and if money is going into your bank account they're not advising on it. That said, if the overall fee is reasonable it doesn't really matter. E.g. a post-TFC 3% initial fee on crystallising £100,000 would be reasonable, therefore a pre-TFC fee of 2.25% must also be reasonable.

john-306

Malthusian wrote: »

No adviser can tie you in, you are free to dispense with their services at any time.

You are correct of course, I should have added "without paying an exit fee".
But they will still be getting their cut, and they're just enticing people in with their low initial 1%.

SonOf

You are correct of course, I should have added "without paying an exit fee".

IFAs cannot charge an exit fee. It is only some vertically integrated FAs that do.

mcc100

john-306 wrote: »

Rang loads up already, Tideway said they'd return call. They didn't.
Also found they tie you in for years.

Fair enough not to use them if they didn't return your call, but to say they tie you in for years is incorrect.

You are under no obligation to use them once the transfer has been completed.

john-306

mcc100 wrote: »

Fair enough not to use them if they didn't return your call, but to say they tie you in for years is incorrect.

You are under no obligation to use them once the transfer has been completed.

See my reply 2 posts up.

From tideway site, talking about another company.

One of the UK’s largest wealth management company in particular markets defined benefit pension transfer advice without any initial charge to your fund if you transfer with them. However, their pension platform charge at 1% p.a. is five times the UK norm for a secure pension platform and this margin allows them to fund 4.5% up front payments to individual advisers, protected by a 6% exit fee if you try to move your funds within one year of the pension transfer. Such exit fees apply for six years on a sliding scale to ensure the company is never out of pocket. Total ongoing fees for this company will typically be over 2% p.a.

Not all companies are as cheap as they appear.