Db pension transfer advice/suitability report.

Prism

For anyone that wants to test out an insistent client transfer to a SIPP you could check out Curtis Banks and James Hay.

e.g 10.3.3

DocumentView.aspx (jameshay.co.uk) 

RoadToRiches

Prism said:

For anyone that wants to test out an insistent client transfer to a SIPP you could check out Curtis Banks and James Hay.

e.g 10.3.3

DocumentView.aspx (jameshay.co.uk) 

I’d look for a personal pension that does not have an exit charge if you’re looking to use them to move into a SIPP.

Malthusian

Nobody is asking for financial advice.

Two names of two providers is close enough to a specific recommendation by my yardstick.

"Checking out" stands a good chance of achieving nothing as if you asked someone in an insurer's call centre whether you can hypothetically transfer a DB pension to them I would not be at all surprised if they answered "no". But that wouldn't change the law.

Again, a cynical inversion of the transaction forced upon the client. The client has to hire the adviser. The adviser assures the client that the client has the final say. But the adviser doesn't even know, nor care, whether that is true?

If you pay me to advise you to not jump off a cliff it doesn't oblige me to tell you where the nearest cliff is for free. 

Most advisers will correctly confirm to the client that if they do not need a positive recommendation to transfer.

Prism said:

For anyone that wants to test out an insistent client transfer to a SIPP you could check out Curtis Banks and James Hay.

e.g 10.3.3

DocumentView.aspx (jameshay.co.uk) 

Don't bother - neither James Hay nor Curtis Banks accept insistent clients. Nor does any SIPP provider that I'm aware of since AJ Bell did a reverse ferret. The T&C you refer to simply state the law.

Diplodicus

Malthusian said:

Nobody is asking for financial advice.

Two names of two providers is close enough to a specific recommendation by my yardstick.

"Checking out" stands a good chance of achieving nothing as if you asked someone in an insurer's call centre whether you can hypothetically transfer a DB pension to them I would not be at all surprised if they answered "no". But that wouldn't change the law.

Again, a cynical inversion of the transaction forced upon the client. The client has to hire the adviser. The adviser assures the client that the client has the final say. But the adviser doesn't even know, nor care, whether that is true?

If you pay me to advise you to not jump off a cliff it doesn't oblige me to tell you where the nearest cliff is for free. 

Most advisers will correctly confirm to the client that if they do not need a positive recommendation to transfer.

Prism said:

For anyone that wants to test out an insistent client transfer to a SIPP you could check out Curtis Banks and James Hay.

e.g 10.3.3

DocumentView.aspx (jameshay.co.uk) 

Don't bother - neither James Hay nor Curtis Banks accept insistent clients. Nor does any SIPP provider that I'm aware of since AJ Bell did a reverse ferret. The T&C you refer to simply state the law.

And that, I'm afraid, is the nadir to which the DB pension transfer advice market has sunk. 

1) You have to hire an adviser.
2) The adviser makes a self-serving recommendation.
3) No clear way forward. Just say "thank you.".  

Linton

Cus said:

Linton said:

rich744 said:

Linton said:

rich744 said:

The advice is invariably to stay put. The pension transfer specialists and FA's are running scared of the regulator. 

Wanting to pass on your money seems like a very reasonable desire to me. 

The reason why employers pay into DB pensions and the government provides tax breaks is to help people to have a reasonable standard of living in retirement.  Money in pensions is not your money. It is money held in trust for your benefit. You have probably contributed less than half of it. Why should employers and the government subsidise your gifts to your beneficiaries?

The regulator seems to be taking a similar view.  If a transfer is demonstrably for your benefit eg if you have a terminal illness, you should have no problem with getting a transfer.

All regulated professionals must follow the requirements of their regulator. If they don’t they could be prevented from continuing in business. That is the purpose of having a regulator.

If you want complete freedom of choice with your money don’t put it in a DB pension.

Bizzare  - Pensions are contractual deferred earnings. The idea that 'money in your pension is not your money' is nuts. The pension freedoms bill was implemented to provide errrr, freedom, to do what you like with the accrued contractual value you have attained.

Having been through the process it's a convoluted sham that goes against the spirit of the Bill.  

Thanks for adding extra detail to my argument...

I would be astonished if your contract of employment gave you anything other than the right to a guaranteed income at retirement.  It would not have given you any right of access to the assets held by the trustees to ensure that they can meet the contractual obligations.  Those assets are not your money.  Please correct me if your contract of employment is dfferent. 

The "pensions freedom" bill was only intended to apply to DC pensions.  It did not give DB pensioners any extra freedoms that were not already allowed by the law. Quite the reverse as it added a couple of relatively minor restrictions, one of these being the requirement to receive regulated advice.

Transfer of DB pensions was always legally possible.  It just was very rarely used since prior to the 2008 crash the CETVs were much lower and would be very unlikely to provide sufficient income to replace the DB pension lost.  The main usage of DB pension transfer was for difficult cases such as severely reduced life expectancy and by scammers to swindle naive pensioners. 

The employment contract gives the right to a guaranteed income. This is a liability that needs to be managed by the trustees. If you died them they would adjust their liabilities.  The trustees attach a 'value' to this liability as the CETV. So in my mind this money is the employees money...

Before the 2008 crash and bond yields plummeting, transfers were rare as you say. Was there the £30k advice mandate, and was there the restrictive impact of IFA insurance at that time? Was there the same 'negative advice' concept, and the fear of taking in a transfer etc?

Was it just the case that because cetv's were lower, few people did it, no one worried about it and no one was worried about any come back years later?

The requirement for advice on DB pension transfer came in with the 2015 pensions freedom legislation.  There was no fundamental perceived problem until that time.  Prior to that legislation there were limitations on the amount you could drawdown on DC pensions so drawdown was less attractive - unless you could prove you had significant other retirement income the limit was (IIRC) not very different to the then annuity rate.  Most people with DB pensions would not have had sufficient other retirement income to take more.

"Was it just the case that because cetv's were lower, few people did it, no one worried about it and no one was worried about any come back years later?"

I think that is a fair description of the general situation.

Linton

Diplodicus said:

Well no, the basis of the transaction is that the client is forced to hire an adviser if he wants to transfer a  DB pension; not  that the client should adhere to the adviser's advice.  Legislation is quite explicit:- the final determination rests with the individual.

Again, a cynical inversion of the transaction forced upon the client. The client has to hire the adviser. The adviser assures the client that the client has the final say. But the adviser doesn't even know, nor care, whether that is true? You can see how that looks to the individual preparing to start the process. Does a real adviser want to chip in here?

According to the law the client has the final say on whether to transfer his/her DB pension.  However there is no law compelling the providers to accept a transfered pension (except it appears with stakeholder pensions).  They make that decision on commercial grounds. Any company can decide whether to take on a customer or not as long as the reason is not contrary to discrimination laws.

Linton

Diplodicus said:

Malthusian said:

Nobody is asking for financial advice.

Two names of two providers is close enough to a specific recommendation by my yardstick.

"Checking out" stands a good chance of achieving nothing as if you asked someone in an insurer's call centre whether you can hypothetically transfer a DB pension to them I would not be at all surprised if they answered "no". But that wouldn't change the law.

Again, a cynical inversion of the transaction forced upon the client. The client has to hire the adviser. The adviser assures the client that the client has the final say. But the adviser doesn't even know, nor care, whether that is true?

If you pay me to advise you to not jump off a cliff it doesn't oblige me to tell you where the nearest cliff is for free. 

Most advisers will correctly confirm to the client that if they do not need a positive recommendation to transfer.

Prism said:

For anyone that wants to test out an insistent client transfer to a SIPP you could check out Curtis Banks and James Hay.

e.g 10.3.3

DocumentView.aspx (jameshay.co.uk) 

Don't bother - neither James Hay nor Curtis Banks accept insistent clients. Nor does any SIPP provider that I'm aware of since AJ Bell did a reverse ferret. The T&C you refer to simply state the law.

And that, I'm afraid, is the nadir to which the DB pension transfer advice market has sunk. 

1) You have to hire an adviser.
2) The adviser makes a self-serving recommendation.
3) No clear way forward. Just say "thank you.".  

Why is the advisor's recommendation "self serving"?  Getting advice is required by legislation as passed by Parliament. IFAs are required to provide documented unbiased advice on the advisability of pension transfers after detailed investigation following the guidelines specified by the FCA.   Is there any evidence that that is not done? 

If you believe the advice is inappropriate to your circumstances you can complain to the advisor's company and if not satisfied with any proposed resolution raise the matter with the Ombudsman.  Now that would be an interesting case for pension nerds.

Diplodicus

Linton said:

Diplodicus said:

Malthusian said:

Nobody is asking for financial advice.

Two names of two providers is close enough to a specific recommendation by my yardstick.

"Checking out" stands a good chance of achieving nothing as if you asked someone in an insurer's call centre whether you can hypothetically transfer a DB pension to them I would not be at all surprised if they answered "no". But that wouldn't change the law.

Again, a cynical inversion of the transaction forced upon the client. The client has to hire the adviser. The adviser assures the client that the client has the final say. But the adviser doesn't even know, nor care, whether that is true?

If you pay me to advise you to not jump off a cliff it doesn't oblige me to tell you where the nearest cliff is for free. 

Most advisers will correctly confirm to the client that if they do not need a positive recommendation to transfer.

Prism said:

For anyone that wants to test out an insistent client transfer to a SIPP you could check out Curtis Banks and James Hay.

e.g 10.3.3

DocumentView.aspx (jameshay.co.uk) 

Don't bother - neither James Hay nor Curtis Banks accept insistent clients. Nor does any SIPP provider that I'm aware of since AJ Bell did a reverse ferret. The T&C you refer to simply state the law.

And that, I'm afraid, is the nadir to which the DB pension transfer advice market has sunk. 

1) You have to hire an adviser.
2) The adviser makes a self-serving recommendation.
3) No clear way forward. Just say "thank you.".  

Why is the advisor's recommendation "self serving"?  

Same principle governing your post just before: if pension providers make decisions based on "commercial grounds" (self interest) then so do individual clients and so do financial advisers. Self interest is like gravity; it's nature.

Which is not to say that Financial Advisers are particularly mercenary, they're just like everyone else. Human/Nature.

To take a very topical parallel: it's like teachers marking their pupils' exams. 

Diplodicus

Linton said:

Diplodicus said:

Malthusian said:

Nobody is asking for financial advice.

Two names of two providers is close enough to a specific recommendation by my yardstick.

"Checking out" stands a good chance of achieving nothing as if you asked someone in an insurer's call centre whether you can hypothetically transfer a DB pension to them I would not be at all surprised if they answered "no". But that wouldn't change the law.

Again, a cynical inversion of the transaction forced upon the client. The client has to hire the adviser. The adviser assures the client that the client has the final say. But the adviser doesn't even know, nor care, whether that is true?

If you pay me to advise you to not jump off a cliff it doesn't oblige me to tell you where the nearest cliff is for free. 

Most advisers will correctly confirm to the client that if they do not need a positive recommendation to transfer.

Prism said:

For anyone that wants to test out an insistent client transfer to a SIPP you could check out Curtis Banks and James Hay.

e.g 10.3.3

DocumentView.aspx (jameshay.co.uk) 

Don't bother - neither James Hay nor Curtis Banks accept insistent clients. Nor does any SIPP provider that I'm aware of since AJ Bell did a reverse ferret. The T&C you refer to simply state the law.

And that, I'm afraid, is the nadir to which the DB pension transfer advice market has sunk. 

1) You have to hire an adviser.
2) The adviser makes a self-serving recommendation.
3) No clear way forward. Just say "thank you.".  

Why is the advisor's recommendation "self serving"?  Getting advice is required by legislation as passed by Parliament. IFAs are required to provide documented unbiased advice on the advisability of pension transfers after detailed investigation following the guidelines specified by the FCA.   Is there any evidence that that is not done? 

Where do you want to start?

Raising the standards on DB pension advice? 

https://www.fca.org.uk/publications/multi-firm-reviews/defined-benefit-pension-transfers

xylophone

"Checking out" stands a good chance of achieving nothing as if you asked someone in an insurer's call centre whether you can hypothetically transfer a DB pension to them I would not be at all surprised if they answered "no". But that wouldn't change the law.

Re stakeholder - once more into the breach.... my post of 18 June

https://forums.moneysavingexpert.com/discussion/comment/78413769/#Comment_78413769