Anyone dealt with this company?

[Deleted User]

So, being in the know, if his adviser provides a negative recommendation, the client can transfer his DB pension to a stakeholder pension with the Pru, then move it to a SIPP. 

Bit of a muddle, but the whole DB transfer/ Financial Adviser thing is unsatisfactory.

Doubtful whether the "stakeholder" option is at the forefront of concerns for the OP. For him, there would be an extra £600 to pay in VAT if Pensionhelp's involvement stopped with their report; but that is small change compared to the potential opportunity cost of doing nothing.

[Deleted User]

garmeg said:

dunstonh said:

bigadaj said:

I thought this has been discussed before and it was determined that there weren't any stakeholder schemes that were open to new investments?

A handful.  However, most of those left only retail via intermediaries and they would be the blocker.  However, I believe there are one or two that still accept direct to client.

in 99% of cases a DB to DC transfer is a bad idea.

Disagree. I suppose the claim is based on FCA guidance last year - 9/10 DB transfers a bad idea - multiplied by ten for good measure.

2019 findings

• 234,951 DB scheme members received advice on whether to transfer between April 2015 and September 2018.
• Of those receiving advice 162,047 members (69%) had been recommended to transfer out, and 72,904 members (31%) had been recommended not to transfer.
• Of those advised not to transfer, 9,534 (13%) of those clients transferred as ‘insistent clients’.
• Across recommendations for and against transfer, the average transfer value was £352,303 equivalent to a total value advised upon of £82.8bn. This compares to £1.57trn in DB schemes eligible for the Pension Protection Fund as at 31 March 2018.  

Of the 171,581 clients who were recommended to transfer or who transferred as insistent clients, 120,735 (70%) signed up to ongoing advice from the firm recommending the transfer.

We expect advisers to start from the position that a pension transfer is unlikely to be suitable for their client.  As such, we are concerned that 69% of the 234,951 total members seeking advice had been recommended to transfer.

Worth noting that, less then four years ago, the FCA  took "no view" on whether a DB transfer was suitable. There is a subtext to the change of attitude: the FCA are concerned about the debilitating effect of ongoing fees affecting the viability of DB transfers over the lifetime of a pension. There may well be an avalanche of claims against these transfers in future, but it won't come from insistent clients or DIY investors imo.

dunstonh

Could you not open a stakeholder via, say, Cavendish and then do the transfer in directly to the provider once the stakeholder is open?

A lot of stakeholder providers (not that there are many now) require top ups to go via the intermediary.  If you could find one that didnt, then I cannot see why that would not be possible.

So, being in the know, if his adviser provides a negative recommendation, the client can transfer his DB pension to a stakeholder pension with the Pru, then move it to a SIPP. 

Don't hold me to it but I don't think Pru have a stakeholder pension any more.

Disagree. I suppose the claim is based on FCA guidance last year - 9/10 DB transfers a bad idea - multiplied by ten for good measure.

I think the figure comes from the historical data including the majority of years when DB transfer values were much lower.   9 out 10 would be the ballpark back then.   However, with high transfer values, I personally don't feel the 9/10 figure is realistic.   

I also think the FCA is unrealistic in what it considers as a viable transfer.  I suspect that what many here would consider a high multiple and an easily viable transfer would still see the FCA say it is likely to be unsuitable.

Tealblue

dunstonh said:

Don't hold me to it but I don't think Pru have a stakeholder pension any more.

They have a stakeholder application form on their website.

dunstonh

Tealblue said:

dunstonh said:

Don't hold me to it but I don't think Pru have a stakeholder pension any more.

They have a stakeholder application form on their website.

I thought they closed it for new business years ago.   It doesn't appear as available on the research software and nothing for new business on the adviser site (just existing customers with one)..  I did a quick search but couldn't see it on the consumer site.  Just their retirement account.   They must be hiding it from me.

Tealblue

dunstonh said:

Tealblue said:

dunstonh said:

Don't hold me to it but I don't think Pru have a stakeholder pension any more.

They have a stakeholder application form on their website.

I thought they closed it for new business years ago.   It doesn't appear as available on the research software and nothing for new business on the adviser site (just existing customers with one)..  I did a quick search but couldn't see it on the consumer site.  Just their retirement account.   They must be hiding it from me.

Here's the link: https://www.pru.co.uk/pdf/SHPK0337.pdf

The form is shown as last revised 03/2020, so very much a current offering.

Brynsam

ZingPowZing said:

 Articles such as this from as far back as 2016 indicate that not too many cottoned on to the DB to stakeholder/stakeholder to SIPP possibility:

 See what you did there, Brynsam.
Apart from being a stepping stone to a SIPP, is there a good reason to transfer a DB pension to a stakeholder pension, iyo?

Generally no, because they offer so little flexibility in terms of access to retirement savings, and costs may not be any better (could be worse, too!) than other personal pension products. But as with most things, there are exceptions.

Looking at the number of people who run into trouble with SIPPs because they haven't a clue what they're doing, and end up in wildly unsuitable investments (at worst losing the lot to some unregulated shark and having the devil of a job getting anything back from anywhere/anyone), there must be a limited number of occasions where a stakeholder would have been preferable. There are restrictions on the type of investments a stakeholder can offer (which must offer a default investment option) and stakeholders can't charge an exit fee, both of which would be preferable if you'd just lost your life savings investing in storage pods in a rain forest, or been charged a massive fee to take your funds 3 months earlier than your 'chosen' retirement age.

[Deleted User]

dunstonh said:

Could you not open a stakeholder via, say, Cavendish and then do the transfer in directly to the provider once the stakeholder is open?

So, being in the know, if his adviser provides a negative recommendation, the client can transfer his DB pension to a stakeholder pension with the Pru, then move it to a SIPP. 

Disagree. I suppose the claim is based on FCA guidance last year - 9/10 DB transfers a bad idea - multiplied by ten for good measure.

I think the figure comes from the historical data including the majority of years when DB transfer values were much lower.   9 out 10 would be the ballpark back then.   However, with high transfer values, I personally don't feel the 9/10 figure is realistic.   

I also think the FCA is unrealistic in what it considers as a viable transfer.  I suspect that what many here would consider a high multiple and an easily viable transfer would still see the FCA say it is likely to be unsuitable.

Good point, dunstonh. 
FCA guidance is based on their findings from '15/'18, when the average transfer overtook the the value of the average house, making it the most important financial decision of a lifetime. So, if 90% should then have been advised not to transfer, but 69% were, then the system whereby financial advisers are paid to recommend on DB transfers was less accurate than a coin toss. 
That's a pretty damning condemnation.

And now the situation is even worse, with many viable transfers turned away because of the FCA rule of thumb and an industry paranoid about future claim liability. 

dunstonh

Tealblue said:

dunstonh said:

Tealblue said:

dunstonh said:

Don't hold me to it but I don't think Pru have a stakeholder pension any more.

They have a stakeholder application form on their website.

I thought they closed it for new business years ago.   It doesn't appear as available on the research software and nothing for new business on the adviser site (just existing customers with one)..  I did a quick search but couldn't see it on the consumer site.  Just their retirement account.   They must be hiding it from me.

Here's the link: https://www.pru.co.uk/pdf/SHPK0337.pdf

The form is shown as last revised 03/2020, so very much a current offering.

As the product is still available for top ups, the key features document needs to be kept up to date.   What I can't see is any reference to it still being open for new business.  Just increments to existing.

[Deleted User]

Brynsam said:

ZingPowZing said:

 Articles such as this from as far back as 2016 indicate that not too many cottoned on to the DB to stakeholder/stakeholder to SIPP possibility:

 See what you did there, Brynsam.
Apart from being a stepping stone to a SIPP, is there a good reason to transfer a DB pension to a stakeholder pension, iyo

Looking at the number of people who run into trouble with SIPPs because they haven't a clue what they're doing, and end up in wildly unsuitable investments (at worst losing the lot to some unregulated shark and having the devil of a job getting anything back from anywhere/anyone), there must be a limited number of occasions where a stakeholder would have been preferable. 

"Better than getting robbed." 
Cheers, Brynsam, heck of an option!

Agree that the first consideration for anyone looking into a transfer is safety from being scammed - something the Pensions Regulator could oversee with a register imo. The Land Registry charge about £5, I think.