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    • borneoboy
    • By borneoboy 20th Sep 19, 1:56 PM
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    borneoboy
    DB BT pension.
    • #1
    • 20th Sep 19, 1:56 PM
    DB BT pension. 20th Sep 19 at 1:56 PM
    Ok I'm New here and getting increasingly confused. I have had two preliminary conversations with independent financial advisers about transferring out my 185k deferred benefits pension. I know everyone's personal circumstances are different but they are proving it difficult for me to do. I require approximately 20% tax-free lump sum and able to put the rest in drawdown or investment can anyone recommend anything. They make it sound like some companies are reluctant to take you on? I had one possible quote a 4250 plus ongoing fees surely there must be cheaper options? Any help appreciated.
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    • MarkCarnage
    • By MarkCarnage 20th Sep 19, 2:15 PM
    • 109 Posts
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    MarkCarnage
    • #2
    • 20th Sep 19, 2:15 PM
    • #2
    • 20th Sep 19, 2:15 PM
    What you describe is pretty normal.

    The situation is that the default advisory position is that a transfer is not likely to be in the best interests of the customer, and the onus is on the adviser to demonstrate otherwise. This is the regulator's position.

    Difficult to state if that quote is reasonable or not without knowing what the ongoing fees are, but if they were say 0.5% p.a. it would not be unreasonable. Professional Indemnity (PI) insurance has risen significantly in the last year or so for advisers conducting transfer advisory business. This reflects the risks of claims for bad advice going a long way into the future potentially.

    It is designed not to be easy to do, and that it is only suitable in a minority of cases.

    Many, indeed most SIPP/drawdown providers will not accept transfers where a positive recommendation has not been given.
    • xylophone
    • By xylophone 20th Sep 19, 5:14 PM
    • 31,434 Posts
    • 19,486 Thanks
    xylophone
    • #3
    • 20th Sep 19, 5:14 PM
    • #3
    • 20th Sep 19, 5:14 PM
    They make it sound like some companies are reluctant to take you on?
    https://forums.moneysavingexpert.com/showthread.php?t=6049879

    As previously explained, before you can transfer out of a DB pension valued at over 30,000, you are required by law to obtain advice from an appropriately qualified adviser with the necessary transfer permissions.

    This involves hours of work and of course, liability for the advice given.

    The adviser will being paying very a high PI premium - remember that the FCA stance is that transfers are likely to be unsuitable for most clients.

    https://www.fca.org.uk/news/press-releases/fca-announces-further-action-defined-benefit-transfers

    Thus advice is unlikely to be cheap.

    You need to check with your adviser before engaging him that regardless of whether or not he recommends a transfer, he will still confirm to the ceding and receiving schemes (in the form that they prescribe) that he has given you the required advice.

    You need to bear in mind that not all schemes will accept a transfer against advice.

    Rather than a transfer out, had you explored the possibility of taking your deferred pension early?

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