Unable to transfer my DB pension - can anyone help?

DairyQueen

random129 said:

DairyQueen said:

random129 said:

I have explored every possible solution and transferring my pension is by far the best solution for me. No point in trying to down size as there are no cheaper homes on the market. I could release equity but that would not be sufficient to cover what I need. I cannot work due to ill health and doubt I will live long enough to benefit from the pension for life a DB pension offers. I am widowed with no dependent children so if I don't transfer and die tomorrow my pension will die with me and my financial affairs will be in a mess for my relatives to sort out. I want to get everything in order, clear my debts and have extra money to spare as a result each month which I can use to buy alternative treatments that help my symptoms. I cannot understand why I cannot do that.

I am sympathetic to you OP but unclear whether the recommendation you received (not to transfer) is reasonable. Also, whether or not you really understand the risks of transferring and what the outcome could be if things went badly wrong. People rarely consider the downside of transferring. Those big numbers can be very seductive.
 
Some of the info you have revealed suggests you could be a candidate for transferring. Other info suggests not. 

I fully understand the risks of transferring. If things went badly wrong and worst case scenario the entire fund was lost I would obviously not be happy but I would still have been able to put the 25% I intend to take tax free to good use by clearing my debts saving me hundreds of pounds a month for the next four years meaning I could afford to pay for alternative treatments again which provide some relief from my disabling health symptoms. I would also have had essential repairs carried out on my property.

I have watched numerous videos and completed several Triage assessments. I could not be more informed about the risks.

I have also ran a few scenarios through a spreadsheet to see how transferring my pension might compare with leaving it where it is. Using the average past performance of funds I might transfer to and taking into account inflation and management fees the likely outcome would be I would run out of money in 2042 when I will be 83. That is if I take 25% now and invest the rest, drawing down the amount each year that I would have received from my DB pension. I would then still own 100% of my home which I could then sell if needed but the likelihood is I will either be dead by then or in a care home.

I fully understand that past performance is no guarantee of future results but it is a useful guideline. My fund might perform better or worse but I believe the risks are well worth taking in my circumstances.

Are you able to post the reasons the IFA gave for advising against a transfer? It won't change the outcome but it may be helpful for you/others to understand how circumstances are assessed, and why some issues may weigh heavily in one direction or another. The experts here (not me) may be able to shed more light on the specific risks the IFA identified in your case.

Their reasons were vague and I got the impression they thought my case wasn't worth the hassle to them. They had waited in vain for over two months for the Administrators of my DB Pension to reply to their request for further information. Despite numerous phone calls and follow up emails the Administrators didn't reply and did not provide the requested information so the IFA made their decision on the information they already had. I questioned at the time how they could make a decision without the information they wanted but to no avail. They did not provide anything in writing to me apart from an Appropriate Advice Declaration form and told me that should be enough to allow me to transfer my pension myself. It wasn't. With hindsight I should have maybe complained about my IFA at that time but I concentrated on trying to get the Administrators to extend the transfer quote expiry date so I could employ another IFA. But the Administrators never responded to my request despite numerous follow up phone calls and emails.

I was under the impression that the IFA must provide reasons for their recommendation. You shouldn't have to jump through hoops to ensure that your case has been correctly assessed and managed. You should have been informed of the reasons why the IFA has advised against.

Unfortunately, the info you provide suggests that, even if your case had been properly handled, or you had been able to employ a second IFA, the advice would be the same and you would still be dealing with the status of 'insistent client'. The extensive research that you undertook suggests that you knew this would be the likely outcome, and you were therefore prepared to follow the few routes then available to transfer against advice. That these routes appear to have now closed could not have been foreseen and you have been caught in a timing trap.

I remain sympathetic as, unlike so many seeking transfers, you appear to be well-informed about the risks. It is likely that you would have run out of money as your health condition appears to impact quality rather than quantity of life, but you are prepared to take the high risk of relative penury in old age in exchange for improved quality of life in the medium term.  In your situation I would also consider that a fair exchange. 

I have a close relative with primary progressive MS. Diagnosed in her early 50s she is now 82 and paraplegic with widespread paresis. Had she been a member of a DB scheme I know she would have chosen to transfer whilst she was still on her feet.  Perhaps there needs to be more emphasis on quality rather than quantity of life when assessing DB transfers for those with disabling conditions that don't reduce life expectancy.

I hope you are able to find a way through this maze and that you succeed in transferring. It isn't often I read a DB transfer thread where I suspect that an IFA has had their hands tied by the regulators and has been unable to advise in the best interests of a client.

[Deleted User]

We digress. The principle of pension freedom is that the final determination belongs to the client. 

Prism

ZingPowZing said:

We digress. The principle of pension freedom is that the final determination belongs to the client. 

Agreed but how do you force private company platforms to accept the transfers.

random129

Prism said:

ZingPowZing said:

We digress. The principle of pension freedom is that the final determination belongs to the client. 

Agreed but how do you force private company platforms to accept the transfers.

The FCA and the government need to step in. Banning ALL DB pension transfers, although that's not what I want, would at least make the situation clear and prevent people wasting money on advice in the expectation they will ultimately be able to transfer regardless of the advice. There is still massive amounts of misinformation out there. A better solution, if it's not possible to compel fund managers to accept insistent clients, would be to set up a government owned fund that would accept all clients who have taken the legally required advice.

AlanP_2

random129 said:

Prism said:

ZingPowZing said:

We digress. The principle of pension freedom is that the final determination belongs to the client. 

Agreed but how do you force private company platforms to accept the transfers.

The FCA and the government need to step in. Banning ALL DB pension transfers, although that's not what I want, would at least make the situation clear and prevent people wasting money on advice in the expectation they will ultimately be able to transfer regardless of the advice. There is still massive amounts of misinformation out there. A better solution, if it's not possible to compel fund managers to accept insistent clients, would be to set up a government owned fund that would accept all clients who have taken the legally required advice.

The chances of the government having the parliamentary time or even the interest to do this is non-existent in my opinion. At the end of the day it is "minor" problem when looked at in terms of number of people affected, and those affected still have the pension they signed up for so where is Govt's incentive to "do something"?

random129

DairyQueen said:

Unfortunately, the info you provide suggests that, even if your case had been properly handled, or you had been able to employ a second IFA, the advice would be the same and you would still be dealing with the status of 'insistent client'. The extensive research that you undertook suggests that you knew this would be the likely outcome, and you were therefore prepared to follow the few routes then available to transfer against advice. That these routes appear to have now closed could not have been foreseen and you have been caught in a timing trap.

There is a lot of misinformation out there so, despite my extensive research, it is only since coming on this forum that I have realised it is probably impossible to transfer as an insistent client. For example, in May this year, as part of a Triage by another IFA I had to watch a series of informational and educational videos from https://www.moneyalive.io. As an example of the misinformation, one of the videos entitled "Do I Need Advice?" in a scenario when a financial adviser recommends not transferring it states; "... but the decision is always yours and you can choose to ignore the advice and transfer anyway".

Linton

random129 said:

Prism said:

ZingPowZing said:

We digress. The principle of pension freedom is that the final determination belongs to the client. 

Agreed but how do you force private company platforms to accept the transfers.

The FCA and the government need to step in. Banning ALL DB pension transfers, although that's not what I want, would at least make the situation clear and prevent people wasting money on advice in the expectation they will ultimately be able to transfer regardless of the advice. There is still massive amounts of misinformation out there. A better solution, if it's not possible to compel fund managers to accept insistent clients, would be to set up a government owned fund that would accept all clients who have taken the legally required advice.

Barring all DB pension transfers would not be sensible as there are some cases such as seriously reduced life expectancy where it is clearly in the person's best interest.  One could include cases such as when the pensioner does not need the income and the pension scheme would benefit from reducing its liabilities.

So the problem is how do you implement a process where the justifiable more extreme cases are separated from those that aren't.  Either it's a government department that make the decision, or someone else.  In theory the pension trustees should be able act in a pensioner's best interests but they probably dont want the responsibility and dont have the time or training to assess the situation nor the ability to take on legal challenges.

Perhaps the government could find a private sector solution and impose sufficient constraints to ensure that the freedom is limited to those relatively few extreme cases.

I agree that the information in this aea should be changed to reflect the actual situation.

dunstonh

 As an example of the misinformation, one of the videos entitled "Do I Need Advice?" in a scenario when a financial adviser recommends not transferring it states; "... but the decision is always yours and you can choose to ignore the advice and transfer anyway".

That is not misinformation  It is technically correct.   The fact that since that video was made that all known providers have pulled out o the market doesn't make it wrong.   You can still use a SSAS potentially

random129

dunstonh said:

 As an example of the misinformation, one of the videos entitled "Do I Need Advice?" in a scenario when a financial adviser recommends not transferring it states; "... but the decision is always yours and you can choose to ignore the advice and transfer anyway".

That is not misinformation  It is technically correct.   The fact that since that video was made that all known providers have pulled out o the market doesn't make it wrong.   You can still use a SSAS potentially

For an informational and educational video you must concede, even if it is theoretically correct, it is misleading at best.

dunstonh

random129 said:

dunstonh said:

 As an example of the misinformation, one of the videos entitled "Do I Need Advice?" in a scenario when a financial adviser recommends not transferring it states; "... but the decision is always yours and you can choose to ignore the advice and transfer anyway".

That is not misinformation  It is technically correct.   The fact that since that video was made that all known providers have pulled out o the market doesn't make it wrong.   You can still use a SSAS potentially

For an informational and educational video you must concede, even if it is theoretically correct, it is misleading at best.

These videos have to be compliance approved and generic.    Basically exam style answers rather than real world answers.  Its an unfortunate position at the moment.  I doubt anyone would disagree with that.