DB pension transfer to sipp or current employers DC?

Justabloke63

Hi all, 
First Post so please be gentle! I was hoping for and would be very grateful for, guidance on transferring an old DB scheme.
I am 57 years old
If I took the defined benefits now they have offered £1523 p. a. and a lump sum of £10153 or no lump sum and £1809 p. a.
Or a CETV of £70,350
Due to circumstances I would like to take the CETV and understand I need an IFA to endorse this and transfer it into another plan. An "introducer" I have spoken to says that the panel of IFAs he uses would only recommend transferring to a SIPP (if recommended at all of course). My initial plan was to try to get it transferred to my current employers DC sheme and retire in the next 1-2 years. I am risk averse and this seemed to be a relatively safe option. I would then take the £70k in chunks. I have no spouse and no dependants and the job i curremtly do is physically demanding. I would like to work part time at most.
I haven't committed to using this "introducer" and am meeting with two separate IFAs ithis coming week.
Does anyone think it likely that an IFA would approve the transfer. The Intoducer would only get paid, he said, if the cetv went into a sipp.
I have learnt a lot in the past weeks about all this but there will be so much rhat I dont know. 
I would be very grateful for thoughts and opinions on strategy / the way ahead,

Thanks in advance

Dazed_and_C0nfused

I am risk averse and this seemed to be a relatively safe option

If you are risk averse what makes you want to transfer it in the first place?

Justabloke63

Hi, sorry I forgot to mention that I have 3 other small DB schemes which kick in when I'm 60. I think these would be enough to live on, a long with a part time job, until SPA of 67.
Basically I could do with chunks of cash to pay off mortgage and a small loan. I would still be left with 30k of the 70k cetv. I thought if i could transfer it to current employer, retire and then take it in chunks (tax inplications permitting) it would be a fairly minimal risk. 

Albermarle

Probably they insist on a SIPP , as they will want to manage the investments going forward . This gives them some security that you will not make a mess of it, and then sue them for giving the transfer the go ahead . Also they can make more money by charging you a % going forward on top of the initial fee ( probably about £3k) .
On the positive side there is no reason a SIPP is more risky than your workplace pension as long as it is mainstream provider, with the investment portfolio  matched to your risk profile correctly - so probably in the end the investment portfolio in the SIPP would not be that much different in your workplace pension, if the IFA does a proper job. 
All pensions are only really as risky as the investments held within them .
Does anyone think it likely that an IFA would approve the transfer.
Not possible to say - the multiple looks OK but it depends on other issues as well, like yur health or if you are married .
Even if they give a negative answer you can still transfer out if you want - make sure before agreeing to start the process that if the IFA gives a negative recommendation , they will still acknowledge that you have been through the correct process, as this is all that is necessary to allow a transfer for the DB scheme to allow it . In fact the DB scheme  can't wait to get rid of the liability of having to pay you an inflation linked pension until you die. You might want to think about why that is ....

xylophone

You might be well advised to  consult a fully qualified Pension Transfer Specialist who would look at the whole picture of your provision for retirement and advise accordingly.
https://adviserbook.co.uk/
You would tick "confirmed independent" and "pension transfer".

Justabloke63

Thanks for the replies, useful knowledge thank you. The IFAs I am seeing are both transfer specialists. I guess ultimately I would go with the SIPP if it made things easier as long as it was the liwest risk sipp available. I would still want to withdraw cash (as tax efficiently as poss) in a year or so. Fingers crossed the IFA I choose will approve it. If they gave a negative result but still agreed to sign the form saying that I had had advice, I suppose then that I would have to try to enact it myself, filling in the forms etc as mosr wouldnt want to act for an insistent client. I will establish their approach to this when I meet them. Thanks again, much appreciated everyone

Dox

I certainly wouldn't use an 'introducer' - why would you? You only need to demonstrate to your DB scheme that you have received advice, not that you've followed it.

What's the rationale behind transferring it to your employer's scheme rather than a SIPP? It won't impact on the transfer advice (or it shouldn't). The only SIPP accepting a transfer without a positive recommendation is AJ Bell. SIPPs themselves are just 'wrappers' - it is the investments you pick within the SIPP that determine the level of risk.

dunstonh

 I am risk averse and this seemed to be a relatively safe option.
That is going to be difficult to get around.

Does anyone think it likely that an IFA would approve the transfer.
I don't think so based on what you have said.   However, decisions are not made based on a few paragraphs of  text.  There is an awful lot of detail missing that would need to be known before a decision is made.

 The Intoducer would only get paid, he said, if the cetv went into a sipp.
Rumour has it that the FCA has decided to ban contingency charging.

Basically I could do with chunks of cash to pay off mortgage and a small loan
paying down the mortgage by taking lumps out the pension is not normally considered a good move unless its part of an overall retirement strategy.  So, that would need further looking at.

 I thought if i could transfer it to current employer, retire and then take it in chunks
So you do have another money purchase pension then? 

Justabloke63

Hi Dunstonh, I have a dc scheme with ny current employer. Hi Dox, the rational was that i presumed it would be more straight forward and less of a risk than a sipp. I agree re the introducer, my instinct says go straight to an IFA. It was only someone at work who had used him when he wanted to transfer a db (he transferred to a sipp).
At the end of the day I will listen with an open mind to the IFA -  if they give the transfer a negative then I will listen to the reasons and well, it may be the best thing. Its tempting to access cash to pay off the mortgage but I will lay out what I want to do and go by the transfer specialists advice. Thanks again 👍

Albermarle

as long as it was the liwest risk sipp available

Just to repeat what has already been said . A SIPP itself can not be low or high risk - it is what investments that are held within it than can be classed according to risk .

So the very lowest risk ( no risk in fact ) would be to keep cash within the SIPP but return would be zero or almost zero .

Do you know what risk level the investments within your workplace pension are? Do they fit with your very risk averse nature ?

Albermarle

I thought if i could transfer it to current employer, retire and then take it in chunks
So you do have another money purchase pension then? 

The OP has a current workplace DC pension .