DB transfers

Albermarle

ZingPowZing said:

Dale72 said:

ZingPowZing said:

Alas, Dale72, from my experience I fear Hargreaves Lansdown advice will be crafted to serve their interest rather than yours.
But it may be that they sold you the promise of a better course than is now available to you. The case is altered since they told you that.

I've also complained to AJ Bell (For what good it will do) as they told me in May that they would still accept it.

Anybody want to wager on Hargreaves Lansdown providing Dale72 with a recommendation to transfer?
I'll stand your bets.

Probably there would not have been a positive recommendation even before the regulations tightened up as the actual CETV offer is not very good anyway .

[Deleted User]

I'll take that as a No from Albermarrle. who - though not strictly a representative of the financial services industry -  is always eager to provide a justification for their practises on this board.

Is that because you offer your support hopefully as collateral for free advice from valued professionals, Albermarle?

candie01

Dale72 said:

NotaBene12 said:

May I ask - which IFA did you use?

I'm having similar problems as the OP. I'm 47, have a DB pension from an ex employer with a CETV of 67K with a corresponding pension of 2.7K. I want to transfer to an existing SIPP (H&L). I have used SIPPs and ISAs for almost a decade and feel comfortable taking the responsibility for managing my own portfolio.

As the amount is above 30K, the pension trustee asks for a declaration from a IFA (interestingly, the form does not ask whether the recommendation is positive or not - just that advice was given) so I contacted a few IFAs and was turned down by all of them. Two said: "Come when you're 50". The rest blankly refused to take me ("We have had too many requests recently", etc.)

So I am really looking for a IFA that would take me without requiring extortionate fees.

Pretty much in the same boat as me. In the end I decided to use HLs own advisors as the price they quoted (2750 to 3000) was competitive, and having an existing relationship I trust them. If they come back and say no to a transfer, then they will provide me with paperwork to show I have received advice, which I'll then take to AJ Bell to transfer my pension to. 

Unfortunately AJ Bell won't accept you if you get a recommendation bit to transfer. They stopped accepting insistent clients as of 01/06

Dale72

Albermarle said:

Probably there would not have been a positive recommendation even before the regulations tightened up as the actual CETV offer is not very good anyway .

I was told by a few IFAs that it was a decent offer. Does anyone actually know what they are talking about in financial services or are they all just guessing?

Dale72

Dale72 said:

Albermarle said:

Probably there would not have been a positive recommendation even before the regulations tightened up as the actual CETV offer is not very good anyway .

I was told by a few IFAs that it was a decent offer. Does anyone actually know what they are talking about in financial services or are they all just guessing?

What is a good offer by the way? I think mine is currently x42, it was higher when I got my first quote so I agree its getting poorer by the minute, but still not bad.

jamesd

Dale72 said:

Albermarle said:

Probably there would not have been a positive recommendation even before the regulations tightened up as the actual CETV offer is not very good anyway .

I was told by a few IFAs that it was a decent offer. Does anyone actually know what they are talking about in financial services or are they all just guessing?

A decent offer depends on the value of the benefits being given up, compared to the alternative benefits being obtained.

If a multiple is used to decide whether it looks good the income used for that multiple needs to be the one at the time of the transfer not some later date. It's quite common to see multiples presented that compare a lump sum around age 55 to income around age 65, resulting in a falsely low and misleading multiple.

The value will be lower if the pension has little or no inflation protection compared to the fairly common 5% cap or something higher. It'll be lower if spousal benefits are unusually poor. It'll be lower farther from normal scheme pension age than closer to it and usually lower if gilt prices fall.

Rising gilt prices have for many years been causing private sector multiples to rise from the 18 to 20 sort of range they were at fifteen or so years ago. It's entirely possible for gilt price changes to undo the effect of getting older.

jamesd

A few days ago Standard Life told me that they will accept insistent client transfers into their Stakeholder Pension against advice. They require that an adviser must do the transfer.

When reading these discussions try to remember that some participants can be philosophically opposed to transfers being allowed and trying to paint the darkest picture possible, not help people to exercise their rights.

dunstonh

jamesd said:

A few days ago Standard Life told me that they will accept insistent client transfers into their Stakeholder Pension against advice. They require that an adviser must do the transfer.

The problem with that though James is that the adviser needed to facilitate the transfer would have to do it on an insistent client basis.  That means they need to be a PTS and advisers are not transacting insistent clients on DB transfers.

The Std Life position is one that is matched by virtually every intermediary provider.  i.e. if an adviser does it, then they will take it.

jamesd

What prompted me to make that call was assisting a poster here whose adviser had said they were willing to transfer on insistent client basis, but wished to do it using a SSAS with AJ Bell as the investment manager used by the SSAS, specifically to get around AJ Bell's no longer being willing to do the business directly. The adviser also asserted that they viewed the Stakeholder route as an unethical loophole. Hence my choice to choose a well known firm like SL.

sandsy

NotaBene12 said:

Albermarle said:

Firstly the multiple is rather poor at x 25 ( often they are around 30 to 35 ) and by the time you have paid an IFA ( if you can find one ) it will be even worse.

If you do find an IFA the transfer recommendation will be negative and although theoretically you can still go ahead , then HL and nearly all other providers will not accept the transfer.

Probably best to shelve the plan .

I'm increasingly starting to believe that the so called "pension freedom" is a myth. At least when it comes to DB transfers.

So far I have contacted +10 IFAs - all refused to deal with me. Two said they do it for over 50 year olds only. Another said that the amount is too small (but didn't mention their minimum). The vast majority refused in various other ways ("too busy", "no longer offering this type of service", etc.).

It seems that I have to simply give up on trying to transfer. What a joke.

It's always been a myth for DB transfers. Pension freedoms were targeted at DC pension holders.

The IFAs who said 'over 50s only' were probably limited by their professional indemnity insurance policies.
The one who said it was too small was probably basing it on the FCA requirement that they should only offer advice if the total charges mean that the transaction you're considering is likely to the of value. The advice charges alone are likely to eat up so much of a low transfer value that it negates any value in transferring.