DB Pension Transfer to SIPP Charges

[Deleted User]

cloud_dog said:

Albermarle said:

It is good point . If it is such a rip off/lucrative exercise , then why do the majority of advisors run a mile when you mention DB transfers?

I think this pretty much sums everything up in one nice, neat sentence.

If these greedy IFAs are really that greedy then, why is it soooo difficult to find one to undertake the DB transfer work?  

Because the eternal see-saw that drives all markets applies to DB pension transfers: the adviser wants the fee and a probable ongoing advice arrangement but is constrained by fear of the consequences or - in short - Greed and Fear.

cloud_dog

ZingPowZing said:

cloud_dog said:

Albermarle said:

It is good point . If it is such a rip off/lucrative exercise , then why do the majority of advisors run a mile when you mention DB transfers?

I think this pretty much sums everything up in one nice, neat sentence.

If these greedy IFAs are really that greedy then, why is it soooo difficult to find one to undertake the DB transfer work?  

Because the eternal see-saw that drives all markets applies to DB pension transfers: the adviser wants the fee and a probable ongoing advice arrangement but is constrained by fear of the consequences or - in short - Greed and Fear.

Sorry but, your point is illogical (captain).

If, as you and some others have stated, that IFAs are money grabbing bad-IFAs, then money is the be all and end all, and therefore they would all be chomping at the bit to make money.  You have espoused this yourself.  For you to now say that there is fear amongst IFAs for undertaking this activity simply re-affirms what others have been saying across many posts and many threads about the high risk nature of this undertaking and therefore it also re-affirms why those who are willing to consider transacting it want to charge silly money to do so.

[Deleted User]

cloud_dog said:

ZingPowZing said:

cloud_dog said:

Albermarle said:

It is good point . If it is such a rip off/lucrative exercise , then why do the majority of advisors run a mile when you mention DB transfers?

I think this pretty much sums everything up in one nice, neat sentence.

If these greedy IFAs are really that greedy then, why is it soooo difficult to find one to undertake the DB transfer work?  

Because the eternal see-saw that drives all markets applies to DB pension transfers: the adviser wants the fee and a probable ongoing advice arrangement but is constrained by fear of the consequences or - in short - Greed and Fear.

Sorry but, your point is illogical (captain).

If, as you and some others have stated, that IFAs are money grabbing bad-IFAs, then money is the be all and end all, and therefore they would all be chomping at the bit to make money.  You have espoused this yourself.  For you to now say that there is fear amongst IFAs for undertaking this activity simply re-affirms what others have been saying across many posts and many threads about the high risk nature of this undertaking and therefore it also re-affirms why those who are willing to consider transacting it want to charge silly money to do so.

You misrepresent me, cloud dog.

I always expect Financial Advisers (or anyone else) to act in their own interest. Indeed, both Financial Advisers I used foe DB advice were doing so, and pretty transparently: one said No (fear) one said Yes (greed). Same pension. The tension in the DB transfer market is between greed and fear. 

Dale72

Ive spoken to lots of IFAs over the last few months, and although the vast majority couldn't help me, very few if any indicated this was because they personally were worried about the risk involved, some mentioned increasing insurance making it not worth their while, others that tighter rules meant they were not qualified to give DB advice and some other varying reasons. I got the impression that most would be perfectly happy to take a fat fee from an insistent client for doing minimal work, if the only thing standing in their way was the risk of the client suing at a future date, rather than any of the other numerous obstacles that have been put in their way.

dunstonh

Dale72 said:

Ive spoken to lots of IFAs over the last few months, and although the vast majority couldn't help me, very few if any indicated this was because they personally were worried about the risk involved, some mentioned increasing insurance making it not worth their while, others that tighter rules meant they were not qualified to give DB advice and some other varying reasons. I got the impression that most would be perfectly happy to take a fat fee from an insistent client for doing minimal work, if the only thing standing in their way was the risk of the client suing at a future date, rather than any of the other numerous obstacles that have been put in their way.

This section of the board tends to have more technically minded posters who consider the reasons why things are the case.  Very different from a quick phone call.

The rules on qualifications haven't changed.  So, nothing tightened there.

As only 1 in 10 advisers can do DB transfers, I very much doubt your perception is correct about the risk of being sued to be the only reason.

Dale72

dunstonh said:

This section of the board tends to have more technically minded posters who consider the reasons why things are the case.  Very different from a quick phone call.

The rules on qualifications haven't changed.  So, nothing tightened there.

As only 1 in 10 advisers can do DB transfers, I very much doubt your perception is correct about the risk of being sued to be the only reason.

I used a couple of sites recommended by the first IFA I spoke to, both filtered the non DB qualified, so the information I gave you was correct. If you disagree with it then take it up with the numerous IFAs who gave me it.

segovia

We were discussing Pensions again at the weekend and my wife mentioned an IFA company that a relative is using to transfer her £900,000 DB scheme. In addition to the initial transfer fee, there is a combined annual charge of 4.5%, not including fund charges, and  requires lock-in 

for a period of 6 years. That's nearly £250,000 in fees over a six-year period. Are there any IFA's would like to break that down into tangible benefits?

IvanOpinion

segovia said:

We were discussing Pensions again at the weekend and my wife mentioned an IFA company that a relative is using to transfer her £900,000 DB scheme. In addition to the initial transfer fee, there is a combined annual charge of 4.5%, not including fund charges, and  requires lock-in 

for a period of 6 years. That's nearly £250,000 in fees over a six-year period. Are there any IFA's would like to break that down into tangible benefits?

One IFA started quoting fees like that to me and got very offended when I laughed in their face.  I have no idea why they were offended since they were aware of other quotes I had received that were a fraction of theirs. 

What annoys me most was that this IFA came highly recommended from a friend that obviously had no idea that any gains he made was pretty much going to pay his IFA.

JoeCrystal

segovia said:

We were discussing Pensions again at the weekend and my wife mentioned an IFA company that a relative is using to transfer her £900,000 DB scheme. In addition to the initial transfer fee, there is a combined annual charge of 4.5%, not including fund charges, and  requires lock-in 

for a period of 6 years. That's nearly £250,000 in fees over a six-year period. Are there any IFA's would like to break that down into tangible benefits?

Why that does sound like she is using St. James's Place Wealth Management to me?! That is the only company I can think of that charge that amount of fees and lock-ins. Frankly, it is caveat emptor. I am sure she is absolutely thrilled to access £900k pot after paying mere peanuts (if any) to her employer back then for it.

[Deleted User]

JoeCrystal said:

segovia said:

We were discussing Pensions again at the weekend and my wife mentioned an IFA company that a relative is using to transfer her £900,000 DB scheme. In addition to the initial transfer fee, there is a combined annual charge of 4.5%, not including fund charges, and  requires lock-in 

for a period of 6 years. That's nearly £250,000 in fees over a six-year period. Are there any IFA's would like to break that down into tangible benefits?

Frankly, it is caveat emptor. 

That is a harsh judgement because it is not a free market. If a buyer wants to transfer a DB pension or just weigh up the option, s/he has to buy “advice.” It is a closed shop that the client approaches in the position of supplicant.

Day after day, posters arrive  to complain about the process and day after day the representatives of the financial services industry (and the regulars on the board who seek to ingratiate themselves with them) respond with some version of “We’re not as bad as them.”

It is a broken market and a looming scandal that the industry is bringing down on itself.