Cost to transfer a 260k pension

RSVP2000

Hello,
What is the average going % rate to transfer a Direct Benefit pension with a transfer value of 260k into a private pension. Also should I expect to pay annual management fees of between one to two percent?

Thanks

JoeCrystal

At least four figures, even five figures if it especially expensive charges.

Dazed_and_C0nfused

And why do you want to transfer it 🤔

Cobbler_tone

It is expensive. You either pay for abridged advice (some do this free) and then full advice if wanting to fully explore and ultimately transfer. I have seen abridged advice for £1k and full advice for £8-12k or a percentage.
Fortunately my scheme gives full advice as a taxable benefit for £1450, so just the tax on that amount.
The thing to note is that you will usually pick up the tab whether you decide to transfer or not. 

dunstonh

What is the average going % rate to transfer a Direct Benefit pension with a transfer value of 260k into a private pension.

In the ballpark of £5000 to £10,000 

. Also should I expect to pay annual management fees of between one to two percent?

£260k is not a lot. (had you transferred back in 2021, the CETV would likely have been over £500k).  You are looking at this after a period when it was pretty easy to justify to a period where only around 1 in 10 are justifiable.

On just £260k, you are not likely to get the lowest advice charges but shouldn't be that far off.   If you have ongoing servicing then circa 1.1% to around 0.3-0.5% without ongoing servicing.

Albermarle

RSVP2000 said:

Hello,
What is the average going % rate to transfer a Direct Benefit pension with a transfer value of 260k into a private pension. Also should I expect to pay annual management fees of between one to two percent?

Thanks

Are you aware that it is likely that you will get a recommendation not to transfer ( most do but not all). Especially since the transfer values have gone down a lot recently, but the benefits of staying in the DB scheme will not have changed.
In that case you can still go ahead with the transfer, but you will find the large majority of DC pension providers will not accept the transfer.
So worrying about advisor annual charges at this stage is a bit premature.

Cobbler_tone

You should be able to source free abridged advice, who may well advise you not to pursue and then it won't cost you anything.

Albermarle

Cobbler_tone said:

You should be able to source free abridged advice, who may well advise you not to pursue and then it won't cost you anything.

Or more likely abridged advice for a fee, but still a LOT less than the full advice.

Silvertabby

Cobbler_tone said:

You should be able to source free abridged advice, who may well advise you not to pursue and then it won't cost you anything.

Beware of 'free' advice from someone who would only recommend a transfer into a scheme that they work for....

Cobbler_tone

Silvertabby said:

Cobbler_tone said:

You should be able to source free abridged advice, who may well advise you not to pursue and then it won't cost you anything.

Beware of 'free' advice from someone who would only recommend a transfer into a scheme that they work for....

Abridged advice won’t do that. They’ll either say “you shouldn’t transfer” or more likely “you need full advice”. If anyone then offers full advice for peanuts then run! 

I personally think the whole thing is a scam because if someone is switched on they could do most of it on their own, at least to the point of making an informed decision. The IFA’s have certainly turned it into a big money maker.

Marcon

Cobbler_tone said:

Silvertabby said:

Cobbler_tone said:

You should be able to source free abridged advice, who may well advise you not to pursue and then it won't cost you anything.

Beware of 'free' advice from someone who would only recommend a transfer into a scheme that they work for....

Abridged advice won’t do that. They’ll either say “you shouldn’t transfer” or more likely “you need full advice”. If anyone then offers full advice for peanuts then run! 

I personally think the whole thing is a scam because if someone is switched on they could do most of it on their own, at least to the point of making an informed decision. The IFA’s have certainly turned it into a big money maker.

You might 'personally think' that, but the reality is something else entirely.

Funny that so many IFAs have quit the transfer market if it's such a wonderful way to make money. Do you have the faintest idea how high risk giving advice on a DB transfer is, and how it impacts on their PI premium  going forward?