Final Salary Transfer Out - Can anyone recommend a company?

bigjoe90

My dad has final salary pension, and he is thinking about transferring it. He already has a transfer out quote and it is just over 100k in value. 
He lives in Leeds now, does he have to go in person to see someone for advice or can this be done online? 
Some of the local quotes is getting are £2000+vat for advice regardless if he goes ahead or not and another 3% on top if he does. 
His pension is only worth about 4k a year in the scheme, the fees seem excessive to say the least.

Marcon

bigjoe90 said:

My dad has final salary pension, and he is thinking about transferring it. He already has a transfer out quote and it is just over 100k in value. 
He lives in Leeds now, does he have to go in person to see someone for advice or can this be done online? 
Some of the local quotes is getting are £2000+vat for advice regardless if he goes ahead or not and another 3% on top if he does. 
His pension is only worth about 4k a year in the scheme, the fees seem excessive to say the least.

No, he doesn't need to go and see anyone in person.

Fees look about the sort of level he could expect to pay. It's very high risk business for the adviser and that's reflected in their fee. He could ask for quotes for something called 'abridged advice', which is a great deal cheaper, but could only result in one of two outcomes:

1. advice not to transfer
2. advice that the position is unclear and more investigation is needed.

If he then wishes to proceed to take the necessary full advice which would enable him to transfer (the DB scheme will need confirmation that he has received full advice, but whether he follows it is up to him), he would need to pay further fees. The work already done/fees already paid would be set off against this - in other words, he wouldn't pay twice for the same work to be done again.

dunstonh

Some of the local quotes is getting are £2000+vat for advice regardless if he goes ahead or not and another 3% on top if he does. 

VAT should not be charged unless the fees are being broken down into segments.  Intermediation is non VATable.   However, if you eliminate the intention to buy a product via that adviser then it becomes VATable.

His pension is only worth about 4k a year in the scheme, the fees seem excessive to say the least.

How much do you think they should be charging for what is probably the highest risk transaction an adviser firm can carry out?  One that the FCA consider to be wrong as default and will cost the adviser firm every year for the rest of their existence and will result in them paying 10 or 20 times in costs a year over firms that do not carry out that class of business?

sandsy

bigjoe90 said:

Some of the local quotes is getting are £2000+vat for advice regardless if he goes ahead or not and another 3% on top if he does. 

Nobody should be charging him an extra 3% if he goes ahead with a transfer than if he doesn't. That sort of charging structure was banned by the regulator for DB transfer advice towards the end of last year. He should pay the same amount for the advice regardless of what he chooses to do after taking the advice. 

Marcon

sandsy said:

bigjoe90 said:

Some of the local quotes is getting are £2000+vat for advice regardless if he goes ahead or not and another 3% on top if he does. 

Nobody should be charging him an extra 3% if he goes ahead with a transfer than if he doesn't. That sort of charging structure was banned by the regulator for DB transfer advice towards the end of last year. He should pay the same amount for the advice regardless of what he chooses to do after taking the advice. 

The FCA banned contingent charging (i.e. where an adviser only gets paid for the advice if the transfer goes ahead). What OP is describing is two charges: one for the advice, which is payable regardless; and another charge if the adviser then arranges the actual transfer.

xylophone

I had a quick look on adviserbook for Pension Transfer Specialists in Leeds - has your father rung round any of these?
https://adviserbook.co.uk/financial-adviser/t/Leeds?dist=10&independent=1&pension_transfer=1

https://www.fca.org.uk/consumers/pension-transfer/advice-what-expect

xylophone

And your father needs to know that  while the Trustees of the ceding scheme merely require confirmation (in their prescribed format) that  he has taken the necessary advice from a PTS (ie they do not ask whether it was positive or negative), not all schemes will accept a DB transfer without a positive recommendation.

https://www.pruadviser.co.uk/knowledge-literature/knowledge-library/transfer-pension-scheme/

However, although most schemes provide the right to transfer, not every scheme has to accept an incoming transfer.

A stakeholder pension scheme is currently the only type of scheme which must accept any transfer from another registered pension scheme.

AJ Bell apparently do accept DB transfers without a positive recommendation.

northerngeezer

I'm also in Leeds and looking to transfer my DB pension. I'm struggling to find an advisor who will help me. One has quoted me £7500 for the advice. 

tacpot12

northerngeezer said:

I'm also in Leeds and looking to transfer my DB pension. I'm struggling to find an advisor who will help me. One has quoted me £7500 for the advice. 

If you have a substantial DB pension, £7500 could be the right price as much of the cost reflects the indemnity insurance the adviser needs to carry in case the client sues. The FCA really did mess things up when they decided that someone who goes against advice they have paid for could sue. It really is the most bonkers decision. While clearly you need to be allowed to sue if the advice work was not conducted correctly, but if the adviser can show that the work was done correctly, then the client should not have any recourse for a decision that they themselves took. As a client of this sort of advice previously, I would have been perfectly happy to accept that the decision and its consequences were mine and mine alone. It is the nanny-state gone mad, and heads should roll for it.

bigjoe90

Its totally crazy these fees. My father is single, 65 in 2 months, so if he transfer to avaia, he can purchase a annuity for a higher yearly amount, than the scheme (as the scheme includes a spouses pension, which he does not need). Plus he can get a greater tax free cash amount.
Why should he have to pay 7k for something he can calculate on a scrap of paper?

daveyjp

A higher yearly amount in year one, what about the amount in year 5, 10, 15 etc.