Can't find IFA who will take my DB case

xylophone

The pension at date of leaving is not important.

This seems to me far too sweeping a statement.

It would only be unimportant if there were no link at all between pension accrued at DOL and pension when drawn.

xylophone

This liability is why I would rather have the negative result. The IFA has the "I told you so" defence.

https://www.fca.org.uk/publication/finalised-guidance/fg21-3.pdf

A firm may advise on a transfer to a scheme that is usually outside the FCA’s regulatory remit, such as a small self-administered scheme (SSAS). When giving DB transfer advice, even though advice on a SSAS is usually unregulated, the adviser may still be responsible for the advice on the SSAS because the 2 pieces of advice are connected. If the investment in the SSAS is a direct consequence of the regulated advice to give up the safeguarded benefits, the 2 pieces of advice will be interconnected.

Thrugelmir

fuzzynavel said:

Thrugelmir said:

fuzzynavel said:

Marcon said:

fuzzynavel said:

Dazed_and_C0nfused said:

fuzzynavel said:

QrizB said:

fuzzynavel said:

The problem is this £1.5k per year pension is actually a DB pension with a transfer pot of £160k.

Are you absolutely certain about those numbers? A multiplier of 106 is ... uncommon.

The exact numbers are  £1,765.43 annual pension calculated at the date of leaving. Guaranteed cash equivalent £160,031.85 

And the date of leaving was........

November 2010...Why do I get the feeling that I am missing something important here?

What you're missing is the statutory requirement for your DB scheme to revalue in deferment - i.e. increase annually from the time you left  active membership in 2010 until you come to draw the benefits in 20 or so years. The £1,765 you are quoting was its value at the time you left active membership, and it will continue to increase each year - something your pension statement should make clear if you read on it (unless you've lost the 'accompanying notes' or whatever verbiage was provided!).

The report is just a checkbox exercise to get the money moved to my SSAS and start investing it in cashflowing assets to allow me to manage and grow the pot so that I can turn it into £10k per month or more rather than £5k per year. I can make that £160k work hard for my fund for the next 20 years. With leverage, I could turn that into 5-10 properties per year if I buy sensibly.

The report is a potential liability for whoever signs it off. As they are in effect underwriting your scheme if it fails. 

The IFA has the "I told you so" defence. 

We live in a blame culture world. Where personal responsibilty soon gets cast aside when there's financial loss involved. Plenty of people have get rich ideas. Trouble is they rely on a high degree of luck, fortunate timing, than any great investment skill. 

grumiofoundation

fuzzynavel said:

Marcon said:

fuzzynavel said:

Dazed_and_C0nfused said:

fuzzynavel said:

QrizB said:

fuzzynavel said:

The problem is this £1.5k per year pension is actually a DB pension with a transfer pot of £160k.

Are you absolutely certain about those numbers? A multiplier of 106 is ... uncommon.

The exact numbers are  £1,765.43 annual pension calculated at the date of leaving. Guaranteed cash equivalent £160,031.85 

And the date of leaving was........

November 2010...Why do I get the feeling that I am missing something important here?

What you're missing is the statutory requirement for your DB scheme to revalue in deferment - i.e. increase annually from the time you left  active membership in 2010 until you come to draw the benefits in 20 or so years. The £1,765 you are quoting was its value at the time you left active membership, and it will continue to increase each year - something your pension statement should make clear if you read on it (unless you've lost the 'accompanying notes' or whatever verbiage was provided!).

The pension provider has changed 3 times since I left the company...Even if it went up to £5k or £10k per year I am not really that interested...The actual value vs buying power should be much the same as today if it is index linked shouldn't it?

In regards to the IFA, being brutally honest, I actually have no interest in getting a positive result. I just want the IFA to do the bare minimum, give me a negative result to protect themselves from comeback and let me cover my legal duties for the transfer. The report is just a checkbox exercise to get the money moved to my SSAS and start investing it in cashflowing assets to allow me to manage and grow the pot so that I can turn it into £10k per month or more rather than £5k per year. I can make that £160k work hard for my fund for the next 20 years. With leverage, I could turn that into 5-10 properties per year if I buy sensibly.

Thanks to you all for your assistance so far

To clarify you believe that if you invest 160k now you will be paying yourself a minimum of 120k per year (in todays money?) in 20 years time (or maybe sooner?)?

The plan is to buy 5-10 properties per year starting with 160k?

160k => 100-200 properties in 2042

Why doesn't everyone do that?

Cheese1990

Bear in mind any investments you make you'll have to satisfy the regulator that as a trustee you are acting in the interests of your members which may be difficult if you are heavily leveraged in property. Also I think you overestimate your returns on 160k over 20 years as by your estimates you expect that 160k to grow to a point of providing you approx 3.6 million ( this is based on living 30 years after retirement) that is a growth of roughly 17%. This also doesn't take into account tax burden for breaching the lta so realistically your expecting even greater growth. 

fuzzynavel

grumiofoundation said:

fuzzynavel said:

Marcon said:

fuzzynavel said:

Dazed_and_C0nfused said:

fuzzynavel said:

QrizB said:

fuzzynavel said:

The problem is this £1.5k per year pension is actually a DB pension with a transfer pot of £160k.

Are you absolutely certain about those numbers? A multiplier of 106 is ... uncommon.

The exact numbers are  £1,765.43 annual pension calculated at the date of leaving. Guaranteed cash equivalent £160,031.85 

And the date of leaving was........

November 2010...Why do I get the feeling that I am missing something important here?

What you're missing is the statutory requirement for your DB scheme to revalue in deferment - i.e. increase annually from the time you left  active membership in 2010 until you come to draw the benefits in 20 or so years. The £1,765 you are quoting was its value at the time you left active membership, and it will continue to increase each year - something your pension statement should make clear if you read on it (unless you've lost the 'accompanying notes' or whatever verbiage was provided!).

The pension provider has changed 3 times since I left the company...Even if it went up to £5k or £10k per year I am not really that interested...The actual value vs buying power should be much the same as today if it is index linked shouldn't it?

In regards to the IFA, being brutally honest, I actually have no interest in getting a positive result. I just want the IFA to do the bare minimum, give me a negative result to protect themselves from comeback and let me cover my legal duties for the transfer. The report is just a checkbox exercise to get the money moved to my SSAS and start investing it in cashflowing assets to allow me to manage and grow the pot so that I can turn it into £10k per month or more rather than £5k per year. I can make that £160k work hard for my fund for the next 20 years. With leverage, I could turn that into 5-10 properties per year if I buy sensibly.

Thanks to you all for your assistance so far

To clarify you believe that if you invest 160k now you will be paying yourself a minimum of 120k per year (in todays money?) in 20 years time (or maybe sooner?)?

The plan is to buy 5-10 properties per year starting with 160k?

160k => 100-200 properties in 2042

Why doesn't everyone do that?

I don't know why more people don't look at property as an investment vehicle. I am up north so have access to cheaper properties but I have acquired 11 flats since November and have cashflow (before expenses) of around £4k PCM (about £3k after expenses). I'm quite happy with the progress so far. I'm aiming to hold 20 properties this year although I'm not sure how I will achieve that yet...The SSAS will definitely help though alongside private investment. I have a couple of private investors at the moment and pay them a generous interest per annum (way above what a bank would offer) + their capital back at the end.

I'm an open book on this stuff so if anyone wants to DM me about this then I will try and answer

fuzzynavel

Cheese1990 said:

Bear in mind any investments you make you'll have to satisfy the regulator that as a trustee you are acting in the interests of your members which may be difficult if you are heavily leveraged in property. Also I think you overestimate your returns on 160k over 20 years as by your estimates you expect that 160k to grow to a point of providing you approx 3.6 million ( this is based on living 30 years after retirement) that is a growth of roughly 17%. This also doesn't take into account tax burden for breaching the lta so realistically your expecting even greater growth. 

Residential properties can't be purchased directly into the SSAS but I can loan a percentage of the SSAS fund to my business for the purposes of buying property to be held in my investment company. The investment company would pay interest on the loan and provide the capital back at a later date.
As the cashflow in the investment company grows I will be able to increase the contributions to the pension which in turn will allow me to pay less corp tax and also lend more money to my property business for more (or bigger) deals. The SSAS doesn't have the £40k per year pension contribution limit. The effect of the SSAS will compound over time and provide the growth.

dunstonh

I don't know why more people don't look at property as an investment vehicle.

Because yields are not what they used to be (still possible in some areas but harder to find). The days of a blind monkey picking a property at random and resulting in profit are gone.    you need to know what to look for now.    And it usually means to make the most, you have to be a bit of an !!!!!! landlord and most people don't want to be.    You also have increasing tax and legislation.

HappyHarry

fuzzynavel said:

The SSAS doesn't have the £40k per year pension contribution limit. 

Not quite - SSAS contributions are measured against the member's annual allowance as with any other pension.

HCIMbtw

fuzzynavel said:

Cheese1990 said:

Bear in mind any investments you make you'll have to satisfy the regulator that as a trustee you are acting in the interests of your members which may be difficult if you are heavily leveraged in property. Also I think you overestimate your returns on 160k over 20 years as by your estimates you expect that 160k to grow to a point of providing you approx 3.6 million ( this is based on living 30 years after retirement) that is a growth of roughly 17%. This also doesn't take into account tax burden for breaching the lta so realistically your expecting even greater growth. 

Residential properties can't be purchased directly into the SSAS but I can loan a percentage of the SSAS fund to my business for the purposes of buying property to be held in my investment company. The investment company would pay interest on the loan and provide the capital back at a later date.
As the cashflow in the investment company grows I will be able to increase the contributions to the pension which in turn will allow me to pay less corp tax and also lend more money to my property business for more (or bigger) deals. The SSAS doesn't have the £40k per year pension contribution limit. The effect of the SSAS will compound over time and provide the growth.

I don't know anything about SSAS 

But I am intrigued by what you are doing. 

Sounds like you:
- Have company set up managing your rental property
- Have an old pension
- Are transferring the value of that pension to a self administered scheme owned by your company 
- Using the SSAS to invest in property and generate cash flow/returns for the company (can you do this?)
- Taking on debt/leverage in the companies name against the companies assets (which include your the SSAS pension fund)
- You use the debt/leverage to purchase properties and generate cash flow 

Assume the risk is if the company fell apart for whatever reason the banks recover their debt and can take the pension assets and you end up with nothing? 

Or am I getting a load of assumptions wrong here.