Final Salary Pension transfer

Silverfox1967

MarkCarnage said:

Dazed_and_C0nfused said:

During the course of this thread your DB pension has already increased by 50%.

It started as a couple of hundred pounds per month and is now £3.6k/year.

It's possible that the initial amount was estimate net of tax and the p.a. amount is gross?

Going back to earlier points made by the OP, there is no 'pot' in a DB scheme...the entitlement is to an income stream as defined in the scheme rules, increasing to varying degrees by inflation. The 'pot' is the assets of the Scheme as a whole held in trust to fund the pensions of all members. 

A transfer value is a capital sum, calculated with reference to various factors, most notably the discount rate on the liabilities of the scheme which is based on longer dated gilt yields. The reason that TVs have fallen considerably since 2021 is that long dated gilt yields have increased very considerably, from under 2% to almost 5%. A few years ago, there was a decent case to be made for transfers in quite a number of situations, and I did so myself for a couple of small DB pensions. I did not do so for my core DB pension though. The transfer values of the two smaller ones were compelling, and offered essentially an arbitrage opportunity to take advantage of the (inevitable) upward reversion of gilt yields when it came along. I could now, if I wished (I don't), buy about twice the level of income via an annuity as I could then.

Not sure where the comment from 6 years ago about waiting for 'it' to go up came from? The income from the pension would almost certainly go up in nominal terms anyway, due to inflation linkage on deferred pensions. I don't think you will find any TVs that are higher than 6 years ago for the reasons stated above, and anyone who told you that clearly didn't know what they were talking about. 

Thanks MarkCarnage for the information, I think that through the course of this thread there have been some sensible and informative responses, also some not so.
i think I’m now in a better position to make my choices. 

MarkCarnage

Silverfox1967 said:

FIREDreamer said:

Silverfox1967 said:

Dazed_and_C0nfused said:

During the course of this thread your DB pension has already increased by 50%.

It started as a couple of hundred pounds per month and is now £3.6k/year.

£3.6k / 12 = ???

£300 = £200 increased by 50%

Who mentioned £200? Couple of hundred, could be 2 could 3

The value that i will receive each month from this on the latest projection is not large, just a couple of hundred pounds

That's what you said in your opening post! Hence the confusion.....

..The bottom line remains that it would appear very unlikely that you would get a positive recommendation to transfer out, the fee of c£4k that you quote for that advice is very reasonable as @dunstonh has clearly outlined and that transfer values have completely recalibrated since you last got one 6 years ago. I don't expect that step change to reverse materially. 

Triumph13

There are a number of red flags in your original post indicating that you know an awful lot less about pensions and investments than you think you do.  Add in the tone of your own subsequent responses, and I would say that Marcon's tone has been entirely reasonable. 

I'm sure he would try to break things more gently if he was being paid for his advice, but as he is already providing the benefit of his considerable expertise for free, it's not surprising that he sometimes gets tired of sugar coating it.

bjorn_toby_wilde

dunstonh said:

Or by taking the DB annually increasing income, less is required to be taken from the DC pension which will be higher in value because of that.

As this thread becomes increasingly heated maybe we’re missing some of the key points.

dunstonh made this point which seems to have been overlooked. OP have you considered this as part of your calculations?

That reliable DB income could mean that you can continue to grow your DC pots and indeed can afford to be more adventurous with the way they are invested.  This could then be passed on to your family if that’s the main consideration.

Silverfox1967

bjorn_toby_wilde said:

dunstonh said:

Or by taking the DB annually increasing income, less is required to be taken from the DC pension which will be higher in value because of that.

As this thread becomes increasingly heated maybe we’re missing some of the key points.

dunstonh made this point which seems to have been overlooked. OP have you considered this as part of your calculations?

That reliable DB income could mean that you can continue to grow your DC pots and indeed can afford to be more adventurous with the way they are invested.  This could then be passed on to your family if that’s the main consideration.

Thanks Bjorn,appreciate your comment that was the decision I came to yesterday following some of the more sensible comments that were made by various members.
For some of the other comments, don’t understand why others feel they have to add in their bit that does nothing other than antagonise.
Sometimes these forums get people in who feel they have to make a comment however irrelevant or not helpful.
i got the answers I wanted and have made my decisions now based upon this.
For all the helpful ones, thanks, for the other advice, I’ll watch with interest.