Help transferring small Defined Benefit Pension

Ste9567

xylophone said:

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

When do you reach normal pension age for the scheme?

Current provider is offering option 1 £2,900 per year at age 65, Option 2 lump sum of 3k now and £2,000 per year at age 65
If I transfer IFA said I will receive 16k now and obviously no guaranteed income of which at £2,900 per year I am not concerned about 

Albermarle

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,

You should be aware that this is a very poor offer . Assuming the pension rises with inflation, then normally for giving up nearly £3000 pa you would expect about £100K .

 obviously no guaranteed income of which at £2,900 per year I am not concerned about 

Strange that you are not concerned . £3K pa income for life is quite valuable. To buy an annuity with inflation linking for £3K would cost about £150K . I think you are underestimating the value of the pension quite significantly and thinking too much about a short term cash payout , but it is up to you of course.

Dazed_and_C0nfused

Albermarle said:

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,

You should be aware that this is a very poor offer . Assuming the pension rises with inflation, then normally for giving up nearly £3000 pa you would expect about £100K .

 obviously no guaranteed income of which at £2,900 per year I am not concerned about 

Strange that you are not concerned . £3K pa income for life is quite valuable. To buy an annuity with inflation linking for £3K would cost about £150K . I think you are underestimating the value of the pension quite significantly and thinking too much about a short term cash payout , but it is up to you of course.

This post is spot on.  You are giving up a valuable guaranteed and inflation proofed income for a fairly poor return.

xylophone

I an assuming that your pension  scheme was "contracted out".

Are you male or female?

In which years were you in the scheme?

Do you have a statement of deferred benefits from when you left the scheme showing

Pre 88 GMP

Post 88 GMP

Excess?

If you do have GMP, how does it revalue in deferment? Fixed Rate? Full Rate?

And the excess?

Have you obtained a state pension forecast?

https://www.gov.uk/check-state-pension

Are you currently an active member of a pension scheme?