Help transferring small Defined Benefit Pension

Ste9567

I have a small defined benefit pension of 62k that I wanted to be able to access as lump sums if and when needed, I have received advise from an IFA recently which has took a couple of months (Full report with no obligation) and they have concluded that it's not in my best interest to transfer and they will have to treat me as an insistent customer ?? to be able to transfer to drawdown, I know after reading forums this is now common practise,

What I am uncomfortable with is that if I transfer then they are going to charge 7% £4,300 to transfer, and a Product Charge of £500.00 Per Year, charged monthly at £42.00 and an Ongoing Review Service 1% £590.00 per year, charged monthly at £49.00, The latter apparently being optional.

This seems an awful lot of money for such a small pension and a straightforward transfer and I am expecting some hidden extra charge somewhere on withdrawal's or something similar, Is there IFA's that will charge a lower amount to do this for me, who are prepared to take this on, Or is there any other way that I gain access to this as my sole intension is to probably draw it down or get some other investment.

Thank you to anyone that can help me with this 

MEM62

Ste9567 said:

This seems an awful lot of money for such a small pension and a straightforward high risk transfer and I am expecting some hidden extra charge somewhere on withdrawal's or something similar,

I have corrected that for you.  Straightforward it is not, by any means.  This is high risk for the IFA and his indemnity insurance and the charge you have been quoted reflects the risk he is taking.   

Marcon

Ste9567 said:

I have a small defined benefit pension of 62k that I wanted to be able to access as lump sums if and when needed, I have received advise from an IFA recently which has took a couple of months (Full report with no obligation) and they have concluded that it's not in my best interest to transfer and they will have to treat me as an insistent customer ?? to be able to transfer to drawdown, I know after reading forums this is now common practise,

What I am uncomfortable with is that if I transfer then they are going to charge 7% £4,300 to transfer, and a Product Charge of £500.00 Per Year, charged monthly at £42.00 and an Ongoing Review Service 1% £590.00 per year, charged monthly at £49.00, The latter apparently being optional.

This seems an awful lot of money for such a small pension and a straightforward transfer and I am expecting some hidden extra charge somewhere on withdrawal's or something similar, Is there IFA's that will charge a lower amount to do this for me, who are prepared to take this on, Or is there any other way that I gain access to this as my sole intension is to probably draw it down or get some other investment.

Thank you to anyone that can help me with this 

Contingent charging (where you pay only if a transfer goes ahead) isn't allowed, so presumably you are paying for the advice - somewhere in the order of £5,000 or thereabouts? Are you sure the £4,300 isn't for the advice?

If they have advised you should not transfer, it is highly unlikely they will help you to do so. Few advisers will accept the responsibility for facilitating a transfer for an insistent client.

xylophone

If they have advised you should not transfer, it is highly unlikely they will help you to do so. Few advisers will accept the responsibility for facilitating a transfer for an insistent client.

It appears from the information given that they are prepared to facilitate the transfer?

Compare https://forums.moneysavingexpert.com/discussion/comment/78698966/#Comment_78698966

Albermarle

xylophone said:

If they have advised you should not transfer, it is highly unlikely they will help you to do so. Few advisers will accept the responsibility for facilitating a transfer for an insistent client.

It appears from the information given that they are prepared to facilitate the transfer?

Compare https://forums.moneysavingexpert.com/discussion/comment/78698966/#Comment_78698966

To go off topic a little, I see from the posts in the link above that Diplodicus is banned .
I guess he will Zing back under another name soon enough .

Ste9567

xylophone said:

If they have advised you should not transfer, it is highly unlikely they will help you to do so. Few advisers will accept the responsibility for facilitating a transfer for an insistent client.

It appears from the information given that they are prepared to facilitate the transfer?

Compare https://forums.moneysavingexpert.com/discussion/comment/78698966/#Comment_78698966

They are indeed accepting to transfer, does this mean they will transfer to any product I prefer ? because it seems to be there product they want me to have  

Ste9567

MEM62 said:

Ste9567 said:

This seems an awful lot of money for such a small pension and a straightforward high risk transfer and I am expecting some hidden extra charge somewhere on withdrawal's or something similar,

I have corrected that for you.  Straightforward it is not, by any means.  This is high risk for the IFA and his indemnity insurance and the charge you have been quoted reflects the risk he is taking.   

I believe straightforward and high risk are two different things, The advise charge they have quoted on there own website suggests 1%, to 7% for more complex cases, I don't believe a small db. pension and a straightforward transfer is a complex case, And regards to there indemnity insurance I don't want to help pay it at 4k when someone else might do the same for 1k

dunstonh

I don't believe a small db. pension and a straightforward transfer is a complex case, 

You are wrong.  DB transfers are pretty much the highest risk transaction an adviser firm can carry out.

Malthusian

This an extremely complex case, and nobody is going to do it for £1,000.

Advisers willing to advise on an "insistent client" basis are extremely rare - in fact round here they were thought to be extinct. You may find that your current adviser won't be doing it for £4,000 either as soon as their professional indemnity insurance comes up for renewal.

Have you considered other options to convert the DB pension into a lump sum such as borrowing against your house and using the DB pension to pay the interest?

xylophone

If you kept the DB pension, what benefits are offered?

When do you reach normal pension age for the scheme?

Ste9567

Malthusian said:

This an extremely complex case, and nobody is going to do it for £1,000.

Advisers willing to advise on an "insistent client" basis are extremely rare - in fact round here they were thought to be extinct. You may find that your current adviser won't be doing it for £4,000 either as soon as their professional indemnity insurance comes up for renewal.

Have you considered other options to convert the DB pension into a lump sum such as borrowing against your house and using the DB pension to pay the interest?

The reason i wanted to transfer this pension is that its only small 62k, which will only pay £2900 per year at age 65, i am 55 now,
I feel that being able to draw some down will be a massive help to me at present and far more beneficial, If I go ahaed with this advisor I will pay 4k but they say I will get a tax free lump sum of 16k, I am fine with the charge if that is the going rate