DB Transfer

unkle

Speak to: https://www.somervillefs.co.uk/key-people/

Gavin Ridgeon

Prism

ZingPowZing said:

Prism said:

ZingPowZing said:

kuratowski said:

  So the reality does not live up to the slogan.  

You don't have to tell that to the unfortunates of the process trapped between financial services greed and financial services fear.
So the reality now is that the client has to pay through the nose for advice he doesn't want and probably won't be able to use. To add insult, the advice itself will likely reflect the interests of the adviser rather than the client, so the bigger error could be in taking a negative recommendation at face value:- that could cost the client many hundreds of thousands of pounds over time.

Or save them hundreds of thousands of pounds depending on what the stock markets do.

I think the concept that quite a few posters are missing is self-determination. 
"Pension Freedom" was not just a slogan but a central tenet of Conservative Party ideology, the freedom/responsibility of the individual to decide for themselves. Clearly, a large part of the financial services industry would gladly go back to the days when their only obligation to the members of their plans was a yearly statement, six-months in arrears. But if those pension plans had not been generating such lousy projected returns in the DC market, Govt may not have had to shake them out of their complacency.

I'm all for people being able to decide themselves, although to be fair they could always decide not to take a job with a DB pension if it bothered them that much. The problem is that for everybody that wants to use the freedom to make the best out of their retirement there are a few that are intent on spaffing it on dodgy investments, crypto and car park schemes and then expecting everyone else to bail them out. So if you can solve that problem then....

[Deleted User]

Prism said:

ZingPowZing said:

Prism said:

ZingPowZing said:

kuratowski said:

  So the reality does not live up to the slogan.  

You don't have to tell that to the unfortunates of the process trapped between financial services greed and financial services fear.
So the reality now is that the client has to pay through the nose for advice he doesn't want and probably won't be able to use. To add insult, the advice itself will likely reflect the interests of the adviser rather than the client, so the bigger error could be in taking a negative recommendation at face value:- that could cost the client many hundreds of thousands of pounds over time.

Or save them hundreds of thousands of pounds depending on what the stock markets do.

I think the concept that quite a few posters are missing is self-determination. 
"Pension Freedom" was not just a slogan but a central tenet of Conservative Party ideology, the freedom/responsibility of the individual to decide for themselves. Clearly, a large part of the financial services industry would gladly go back to the days when their only obligation to the members of their plans was a yearly statement, six-months in arrears. But if those pension plans had not been generating such lousy projected returns in the DC market, Govt may not have had to shake them out of their complacency.

I'm all for people being able to decide themselves, although to be fair they could always decide not to take a job with a DB pension if it bothered them that much. The problem is that for everybody that wants to use the freedom to make the best out of their retirement there are a few that are intent on spaffing it on dodgy investments, crypto and car park schemes and then expecting everyone else to bail them out. So if you can solve that problem then....

Well I'm pretty sure abandoning your insistent clients on the production of a negative recommendation is not the solution. That really is throwing them to the lions..

Marcon

kuratowski said:

And yet, the legislation did not establish a scheme into which they must be accepted.  So the reality does not live up to the slogan.  Quelle surprise.

It already existed - called a stakeholder pension.

Prism

Marcon said:

MX5huggy said:

Why not take the pension now and give your sons the monthly amount received? (There are probably consequences regarding your ability to make further pension contributions to other pensions doing this). 

No - that's if you take taxable cash from a defined contribution pension which you have 'flexibly accessed'.

 kazzykir said:

 I have a financial background after working in a bank for 15yrs, so totally understand how this all works but I cant get anyone to help me transfer.   I would be willing to even take out an indemnity but when I ring companies up, as soon as I say a 'final salary' they get cold feet.  
Any ideas?

So what if the advice is not to transfer? The DB scheme won't want to know what the advice is - just proof that you've received it.  You don't need a positive recommendation to transfer to a stakeholder pension (which must accept transfers in from any UK registered pension scheme); you can then transfer on to a SIPP if you wish, which will be a DC to DC transfer. 

Have you checked that the firms you are ringing have the necessary FCA permissions to advise on DB transfers?

Prism said:

ZingPowZing said:

xylophone said:

However is it possible to open up a new Aviva stakeholder pension? 

Yes, through an adviser.
https://www.aviva.co.uk/adviser/documents/view/sp01001c.pdf

But advisers - generally - won't facilitate a DB pension transfer following a negative recommendation. Because it is safer not to.
Do you mean the insistent client should hire another financial adviser at this point? 

I doubt you will find any advisor willing to open up an Aviva stakeholder to do a transfer that they do not advise doing.

Use one you can open yourself e.g. https://www.standardlife.co.uk/pensions/personal-pension/stakeholder

Its seems that SL not in fact take insistent clients so who else is there?
Defined Benefit / Final Salary Pension - Page 3 — MoneySavingExpert Forum

kuratowski

Marcon said:

kuratowski said:

And yet, the legislation did not establish a scheme into which they must be accepted.  So the reality does not live up to the slogan.  Quelle surprise.

It already existed - called a stakeholder pension.

Stakeholder pensions are a type of scheme that might, or might not, be offered by private sector providers.  Legislation could have created a fallback provider, an actual scheme like NEST, but it did not.

Marcon

Prism said:

Marcon said:

MX5huggy said:

Why not take the pension now and give your sons the monthly amount received? (There are probably consequences regarding your ability to make further pension contributions to other pensions doing this). 

No - that's if you take taxable cash from a defined contribution pension which you have 'flexibly accessed'.

 kazzykir said:

 I have a financial background after working in a bank for 15yrs, so totally understand how this all works but I cant get anyone to help me transfer.   I would be willing to even take out an indemnity but when I ring companies up, as soon as I say a 'final salary' they get cold feet.  
Any ideas?

So what if the advice is not to transfer? The DB scheme won't want to know what the advice is - just proof that you've received it.  You don't need a positive recommendation to transfer to a stakeholder pension (which must accept transfers in from any UK registered pension scheme); you can then transfer on to a SIPP if you wish, which will be a DC to DC transfer. 

Have you checked that the firms you are ringing have the necessary FCA permissions to advise on DB transfers?

Prism said:

ZingPowZing said:

xylophone said:

However is it possible to open up a new Aviva stakeholder pension? 

Yes, through an adviser.
https://www.aviva.co.uk/adviser/documents/view/sp01001c.pdf

But advisers - generally - won't facilitate a DB pension transfer following a negative recommendation. Because it is safer not to.
Do you mean the insistent client should hire another financial adviser at this point? 

I doubt you will find any advisor willing to open up an Aviva stakeholder to do a transfer that they do not advise doing.

Use one you can open yourself e.g. https://www.standardlife.co.uk/pensions/personal-pension/stakeholder

Its seems that SL not in fact take insistent clients so who else is there?
Defined Benefit / Final Salary Pension - Page 3 — MoneySavingExpert Forum

If it's a stakeholder pension, they can't refuse. Clearly someone on a 'helpline' who had no idea what they were talking about.

The provider has complete protection, simply because a stakeholder pension must accept all transfers from any registered UK pension scheme. Section 1 of the Welfare Reform and Pensions Act 1999 - seventh condition.

Marcon

kuratowski said:

Marcon said:

kuratowski said:

And yet, the legislation did not establish a scheme into which they must be accepted.  So the reality does not live up to the slogan.  Quelle surprise.

It already existed - called a stakeholder pension.

Stakeholder pensions are a type of scheme that might, or might not, be offered by private sector providers.  Legislation could have created a fallback provider, an actual scheme like NEST, but it did not.

Look at the vast cost of setting up NEST - why would a 'fallback' be provided when it already existed? 

Bear in mind too that at the time these famous 'freedoms' were introduced, there was no suggestion that the FCA and PI insurers would take their current stance...

HappyHarry

Bear in mind too that at the time these famous 'freedoms' were introduced, there was no suggestion that the FCA and PI insurers would take their current stance...

Though worth remembering that the "pension freedoms" were designed to apply only to DC schemes, and not DB schemes.

jamesd

kuratowski said:

ETA: As you already know, the rules requiring advice for DB transfers were debated extensively before enactment.  This situation is not some unintended consequence, as you like to make out, it is the situation that Parliament expressly wished for.

That assertion does not coincide with my knowledge of what happened in Parliament and via regulation. Parliament did not express a desire for the current mess.

What happened in Parliament was that the committee with responsibility for pensions asserted that the absence of an advice requirement for DB transfers could be harmful, so an advice requirement should be added. The government responded by adding to the original proposal a £30k threshold above which advice would be required.

Regrettably that let the FCA interfere and it has a strong anti-transfer bias as well as being stuck on opinions consistent with transfer values fifteen years ago, so it has used it's regulatory powers to make it harder for advisers and in its last batch of changes was explicit in saying that it was trying to make transfers unaffordable for consumers.

What's needed now is a return to the original plan and getting the FCA out of the way so that those in funded DB schemes get pension freedom instead of FCA blocking tactics.