DB Pension Transfer Advice

soonretire

DaveT55 said:

Hi,

I transferred my DB pension around 12 months ago and the process was relatively straight forward. I was 38 years old and I was informed before I even started the process that I would receive negative advice based solely on age. I had already fully investigated the risks and for me the Pros of an early retirement without penalties, the opportunity to leave savings to my wife and children, plus an excellent CETV meant i was going to transfer whatever the advice. On an insistent client basis the money was transferred to AJ Bell with all paperwork completed by the advisor. To date this pot has grown by 10% and I am more than happy that my decision was the correct one and I have 20 more years to hopefully grow this. 

In the last 2 months my wife's final salary pension has been deferred and we are wanting to go down a similar route. The landscape has clearly changed considerably. We have opted to pay for advice, which will be several thousand pounds and given that "insistent client basis' is no longer accepted at AJ Bell, or anywhere else it seems, we need to try and ensure that the advise we receive from the financial advisor is positive, or it is unlikely any transfer will be possible ( I know stakeholder pensions have been mentioned in other posts, but not sure anyone has done this for a DB and obviously adds complication).

I believe receiving positive advice will be a difficult task based on our age and the standard list of positives for DB pensions that advisors routinely quote. I think the fact the pension advisor will receive the full amount on negative or positive advice also doesn't work in our favour with the increase of 'no win no fee 'claims against transfer advise. we are left trying to make the most comprehensive case to receive a positive recommendation for transfer. I have read a few articles that longer term investment planning in farming or property can be a positive factor for moving out of a DB along with wanting investments in suitably ethical funds rather than the standard investments under a  company DB. 

Can people advise what other factors can be used to receive a positive transfer outcome? I obviously don't want to deliberately lie to the advisor, but unfortunately it seem like people are being left with very little options when they are clear on the route they want to take. 

I would appreciate if people wouldn't leave any advice on pro's of DB pensions and guaranteed income etc. I have read all about it on other posts and went through it all 12 months ago. 

Thanks in Advance 

      

Hi Dave

I have just received an updated CETV and did not appreciate the AJ Bell door had closed. My target is to find a way to transfer out during my quote validity period. Like you I have done my reading and I understand these factors should help my case to get a positive recommendation:

1. I have no partner so spousal benefit is of no help
2. I want the inheritance benefit of money in SIPP
3. I want to make choices about where the money is invested aligned to my ethical beliefs
4. I have other soures of retirement income
5. The 25% withdrawal will help me fund higher education for my children and clear their university loans
6. If needed I will agree to the IFA managing the Pot so that the diligence angle is covered that the money is being invested sensibly. Some IFA's want a commitment which if needed I will give them 12 months max. I will work the process and still transfer to Interactive Investor once I can and consolidate with my existing SIPP and self-manage

It would be great to know how you got on. 

Thanks

Albermarle

soonretire said:

DaveT55 said:

Hi,

I transferred my DB pension around 12 months ago and the process was relatively straight forward. I was 38 years old and I was informed before I even started the process that I would receive negative advice based solely on age. I had already fully investigated the risks and for me the Pros of an early retirement without penalties, the opportunity to leave savings to my wife and children, plus an excellent CETV meant i was going to transfer whatever the advice. On an insistent client basis the money was transferred to AJ Bell with all paperwork completed by the advisor. To date this pot has grown by 10% and I am more than happy that my decision was the correct one and I have 20 more years to hopefully grow this. 

In the last 2 months my wife's final salary pension has been deferred and we are wanting to go down a similar route. The landscape has clearly changed considerably. We have opted to pay for advice, which will be several thousand pounds and given that "insistent client basis' is no longer accepted at AJ Bell, or anywhere else it seems, we need to try and ensure that the advise we receive from the financial advisor is positive, or it is unlikely any transfer will be possible ( I know stakeholder pensions have been mentioned in other posts, but not sure anyone has done this for a DB and obviously adds complication).

I believe receiving positive advice will be a difficult task based on our age and the standard list of positives for DB pensions that advisors routinely quote. I think the fact the pension advisor will receive the full amount on negative or positive advice also doesn't work in our favour with the increase of 'no win no fee 'claims against transfer advise. we are left trying to make the most comprehensive case to receive a positive recommendation for transfer. I have read a few articles that longer term investment planning in farming or property can be a positive factor for moving out of a DB along with wanting investments in suitably ethical funds rather than the standard investments under a  company DB. 

Can people advise what other factors can be used to receive a positive transfer outcome? I obviously don't want to deliberately lie to the advisor, but unfortunately it seem like people are being left with very little options when they are clear on the route they want to take. 

I would appreciate if people wouldn't leave any advice on pro's of DB pensions and guaranteed income etc. I have read all about it on other posts and went through it all 12 months ago. 

Thanks in Advance 

      

Hi Dave

I have just received an updated CETV and did not appreciate the AJ Bell door had closed. My target is to find a way to transfer out during my quote validity period. Like you I have done my reading and I understand these factors should help my case to get a positive recommendation:

1. I have no partner so spousal benefit is of no help
2. I want the inheritance benefit of money in SIPP
3. I want to make choices about where the money is invested aligned to my ethical beliefs
4. I have other soures of retirement income
5. The 25% withdrawal will help me fund higher education for my children and clear their university loans
6. If needed I will agree to the IFA managing the Pot so that the diligence angle is covered that the money is being invested sensibly. Some IFA's want a commitment which if needed I will give them 12 months max. I will work the process and still transfer to Interactive Investor once I can and consolidate with my existing SIPP and self-manage

It would be great to know how you got on. 

Thanks

I would guess that points 1, 4 would be a definite positive . Point 6 would help if the decision was close .
Points 2 & 3 & 5  are not related to you being able to definitely maintain an income as good if not better than now, so is not relevant to the process I would think . In any case it is not clear that this inheritance tax 'loophole' will last forever in its present form.
Regarding what do if you get a negative recommendation, this thread might be of interest , if you can wade through it. 
Pension has finally landed - As an insistent client acting against advice -*DOORS CLOSED 03/09/2021* — MoneySavingExpert Forum

There is a possibility of going through 'Triage' - a cheaper faster process where the advisor will say either 
1) No point going through the full process as the answer will be no.
2) You have a good chance of a positive outcome if you progress to the full process, but this is not guaranteed.

Marcon

soonretire said:

DaveT55 said:

Hi,

I transferred my DB pension around 12 months ago and the process was relatively straight forward. I was 38 years old and I was informed before I even started the process that I would receive negative advice based solely on age. I had already fully investigated the risks and for me the Pros of an early retirement without penalties, the opportunity to leave savings to my wife and children, plus an excellent CETV meant i was going to transfer whatever the advice. On an insistent client basis the money was transferred to AJ Bell with all paperwork completed by the advisor. To date this pot has grown by 10% and I am more than happy that my decision was the correct one and I have 20 more years to hopefully grow this. 

In the last 2 months my wife's final salary pension has been deferred and we are wanting to go down a similar route. The landscape has clearly changed considerably. We have opted to pay for advice, which will be several thousand pounds and given that "insistent client basis' is no longer accepted at AJ Bell, or anywhere else it seems, we need to try and ensure that the advise we receive from the financial advisor is positive, or it is unlikely any transfer will be possible ( I know stakeholder pensions have been mentioned in other posts, but not sure anyone has done this for a DB and obviously adds complication).

I believe receiving positive advice will be a difficult task based on our age and the standard list of positives for DB pensions that advisors routinely quote. I think the fact the pension advisor will receive the full amount on negative or positive advice also doesn't work in our favour with the increase of 'no win no fee 'claims against transfer advise. we are left trying to make the most comprehensive case to receive a positive recommendation for transfer. I have read a few articles that longer term investment planning in farming or property can be a positive factor for moving out of a DB along with wanting investments in suitably ethical funds rather than the standard investments under a  company DB. 

Can people advise what other factors can be used to receive a positive transfer outcome? I obviously don't want to deliberately lie to the advisor, but unfortunately it seem like people are being left with very little options when they are clear on the route they want to take. 

I would appreciate if people wouldn't leave any advice on pro's of DB pensions and guaranteed income etc. I have read all about it on other posts and went through it all 12 months ago. 

Thanks in Advance 

      

Hi Dave

I have just received an updated CETV and did not appreciate the AJ Bell door had closed. My target is to find a way to transfer out during my quote validity period. Like you I have done my reading and I understand these factors should help my case to get a positive recommendation:

1. I have no partner so spousal benefit is of no help
2. I want the inheritance benefit of money in SIPP
3. I want to make choices about where the money is invested aligned to my ethical beliefs
4. I have other soures of retirement income
5. The 25% withdrawal will help me fund higher education for my children and clear their university loans
6. If needed I will agree to the IFA managing the Pot so that the diligence angle is covered that the money is being invested sensibly. Some IFA's want a commitment which if needed I will give them 12 months max. I will work the process and still transfer to Interactive Investor once I can and consolidate with my existing SIPP and self-manage

It would be great to know how you got on. 

Thanks

Have a look at this: https://www.pruadviser.co.uk/knowledge-literature/knowledge-library/pension-transfers-conversions/

The section on DB to DC transfers might be especially relevant for you.

DeadlyD

Malthusian said:

DaveT55 said:

I went down the Standard life route on this today, but they won't accept the transfer without the support/ signature of a financial advisor on the transfer forms, to present confirmation that you have received the necessary advice is not sufficient. They are saying an insistent client basis transfer in is fine, but a FA needs to be supporting/ authorising (albeit against advice) the paperwork side. It's a question of liability.    

If it's a Standard Life Stakeholder Pension you can make a formal complaint that if they refuse to accept the transfer they are failing to meet their legal obligations under The Stakeholder Pension Schemes Regulations 2000, section 1(6).

If they don't change their minds within eight weeks you can go to the Financial Ombudsman and see what they say.

This assumes you already have a Stakeholder Pension open. If not they are quite at liberty to refuse your business, the transfer is irrelevant.

xylophone said: What in the name of heaven does this mean?

I suspect it means they want an adviser to act as servicing agent (which they almost certainly won't as otherwise they will open themselves up to a complaint).

There is no exemption in The Stakeholder Pension Schemes Regulations 2000 for clients who do not have a servicing intermediary.

Does this mean that the Stakeholder pension @SL HAS to take on the DB transfer without an IFA signing off as long as the certificate is gained for the insistent client? 

Malthusian

DeadlyD said:

Does this mean that the Stakeholder pension @SL HAS to take on the DB transfer without an IFA signing off as long as the certificate is gained for the insistent client? 

That is what the law says, yes.

dunstonh

DeadlyD said:

Malthusian said:

DaveT55 said:

I went down the Standard life route on this today, but they won't accept the transfer without the support/ signature of a financial advisor on the transfer forms, to present confirmation that you have received the necessary advice is not sufficient. They are saying an insistent client basis transfer in is fine, but a FA needs to be supporting/ authorising (albeit against advice) the paperwork side. It's a question of liability.    

If it's a Standard Life Stakeholder Pension you can make a formal complaint that if they refuse to accept the transfer they are failing to meet their legal obligations under The Stakeholder Pension Schemes Regulations 2000, section 1(6).

If they don't change their minds within eight weeks you can go to the Financial Ombudsman and see what they say.

This assumes you already have a Stakeholder Pension open. If not they are quite at liberty to refuse your business, the transfer is irrelevant.

xylophone said: What in the name of heaven does this mean?

I suspect it means they want an adviser to act as servicing agent (which they almost certainly won't as otherwise they will open themselves up to a complaint).

There is no exemption in The Stakeholder Pension Schemes Regulations 2000 for clients who do not have a servicing intermediary.

Does this mean that the Stakeholder pension @SL HAS to take on the DB transfer without an IFA signing off as long as the certificate is gained for the insistent client? 

There is a yes and no answer to that.   Whilst a stakeholder pension has to accept it, as mentioned.  The distribution of the product can block it.       The distribution side is through intermediaries. In this case, non-advised intermediaries working for the insurers (either directly or through a subsidiary company).   The intermediary part takes responsibility for the sale of the product. They have decided not to transact any intermediation on DB transfers through their own in-house agency.     

So, whilst the stakeholder must take it, the intermediary in between can refuse to transact it.    So, they are not breaking the stakeholder rules as the stakeholder provider is not refusing it.  The intermediary is refusing it.  Even though they share the same name and logo. 

DaveT55

soonretire said:

Hi Dave

I have just received an updated CETV and did not appreciate the AJ Bell door had closed. My target is to find a way to transfer out during my quote validity period. Like you I have done my reading and I understand these factors should help my case to get a positive recommendation:

1. I have no partner so spousal benefit is of no help
2. I want the inheritance benefit of money in SIPP
3. I want to make choices about where the money is invested aligned to my ethical beliefs
4. I have other soures of retirement income
5. The 25% withdrawal will help me fund higher education for my children and clear their university loans
6. If needed I will agree to the IFA managing the Pot so that the diligence angle is covered that the money is being invested sensibly. Some IFA's want a commitment which if needed I will give them 12 months max. I will work the process and still transfer to Interactive Investor once I can and consolidate with my existing SIPP and self-manage

It would be great to know how you got on. 

Thanks

We have now paid for two separate sets of advice and both have been negative. If you are not in your mid 50's+ and you require positive advice then save your money. There is a 99.9% chance that advice will be negative in the under 55 age group regardless of savings and no matter how many properties you own for secondary pension income. We are in a very fortunate financial position, but this makes no difference. The advisor takes the position that there's too long a period before retirement and will always recommend don't move it, after taking your 3K of course. The view of having a longer period to iron out any ups and downs in the investment market is something that an IFA only pays lip service to in his analysis. 

However, if you are 55+ (and I know several people from the company I work for who have been successful). In no particular order

1. Real term growth
2. Supplementary pension income and not needing to rely on the DB pension
3. Leaving to extended family on death - Good if you can make a case of working in a dangerous job. Middle east etc
4. History of family illness, (where it exists) to mean you require the funds at 55 rather than 65 - I.e history of Alzheimer's
5. A company to manage the pension is a must. As you say 12 months is typical
6. Ethical is a good on as you can't achieve this one in a DB, but not easy to make a case for this. 
7. Expat. (if you are) is also a potential angle to work
8. When the question is asked - state a modest requirement income in retirement. Saying that you need to grow the SIPP to provide a higher income than the DB provides wont go down well.
9. Spousal benefit is irrelevant the IFA also take the position that you might marry.

But hey what do I know - I have been rejected twice, might as well say it before somebody else does. I'm still exploring options, but don't want to state exactly what I'm trying on this forum. For us personally it's worth exploring every possible avenue to remove. The DB transfer market for ICB's like us is like the wild west now.

Best of luck