Lgps -cetv

Advice4sue · 23 May 2019 at 10:20AM

Hi all. I currently work in local government and have done for just over 10 years both full and part time due to family commitments.
I’m 57. My pension will not be of much significance in the overall pot for me and hubby! I would really like to finish work now and I obtained my early retirement figures recently from my lgps fund.
These reduced figures are £1976 per annum from current job plus a diddy referred one from a job many moons ago of £410 with a lump sum of £1333.
If I stayed until retirement age my main one would be about£4500.
Anyway me and hubby are having a financial overhaul at the moment and Im considering obtaining a CETV quote.
I realise in this type of pension it may not be normally worth it but I’m really just looking for some funding during next 10 years until state pension.
Can anyone give me a very approx idea what the CETV might be.
Thanks

Silvertabby · 23 May 2019 at 11:17AM

Advice4sue wrote: »

Hi all. I currently work in local government and have done for just over 10 years both full and part time due to family commitments.
I’m 57. My pension will not be of much significance in the overall pot for me and hubby! I would really like to finish work now and I obtained my early retirement figures recently from my lgps fund.
These reduced figures are £1976 per annum from current job plus a diddy referred one from a job many moons ago of £410 with a lump sum of £1333.
If I stayed until retirement age my main one would be about£4500.
Anyway me and hubby are having a financial overhaul at the moment and Im considering obtaining a CETV quote.
I realise in this type of pension it may not be normally worth it but I’m really just looking for some funding during next 10 years until state pension.
Can anyone give me a very approx idea what the CETV might be.
Thanks

It's something you will have to ask the LGPS for, as there are far too many factors involved for anyone here to be able to give you an accurate figure.

The best I can do is to say that CETV's for the LGPS seem notoriously stingy when compared with the 30x or 40x annual pension given up sometimes quoted on these boards. That's because private pension transfer factors are determined by the value of gilts, whereas the LGPS factors are set by GAD.

If you really want some idea now, then you'll be lucky to see 20x pension given up - could be even less. Also, as the value of your benefits will be over £30K, you will need to take (and pay for) independant financial advice. IFA's willing to endorse a transfer out of DB schemes in general are getting fewer and fewer, due to increased liability insurance premiums.

Advice4sue · 23 May 2019 at 11:27AM

Thanks for your reply. Am I right in assuming a very rough guesstimate
of x 20 would be at the reduced early retirement figures I gave in the post rather than the amount forecast at age 67? Thanks

Silvertabby · 23 May 2019 at 11:50AM

Advice4sue wrote: »

Thanks for your reply. Am I right in assuming a very rough guesstimate
of x 20 would be at the reduced early retirement figures I gave in the post rather than the amount forecast at age 67? Thanks

Sorry, there really are so many factors involved the only safe way would be to get a CETV from your LGPS. Did you do your own retirement quote or did you ask your LGPS to run it for you? If the latter, then it should be an easy enough job for them to be able to give you a CETV quote based on the leaving date of your retirement quote.

Advice4sue · 23 May 2019 at 12:15PM

Thanks for your help. Yes the early retirement quote was from the scheme.
I have now just requested a transfer valuation through them. Apparently there is a backlog at present. I was surprised as I understand in the vast majority of cases it isn’t worth while so I had innocently assumed I would be one of very few! It seems much more complicated than I thought. I realise I will need to obtain financial advice but we are doing a general overhaul anyway and seeing one in next few weeks.
You mentioned that there are fewer advisors willing to endorse transferring out which I can understand in many cases but I’m still hoping it’s s possibility as it’s not a pension we need to rely on. I just want it to give me a small funding for next 8/10 years. Thanks

Silvertabby · 23 May 2019 at 12:37PM

Advice4sue wrote: »

Thanks for your help. Yes the early retirement quote was from the scheme.
I have now just requested a transfer valuation through them. Apparently there is a backlog at present. I was surprised as I understand in the vast majority of cases it isn’t worth while so I had innocently assumed I would be one of very few! It seems much more complicated than I thought. I realise I will need to obtain financial advice but we are doing a general overhaul anyway and seeing one in next few weeks.
You mentioned that there are fewer advisors willing to endorse transferring out which I can understand in many cases but I’m still hoping it’s s possibility as it’s not a pension we need to rely on. I just want it to give me a small funding for next 8/10 years. Thanks

If you've already booked your appointment, ask your IFA to request the CETV (and other relevant scheme details) on your behalf. In theory, the timescale should be the same regardless of who asks for the information, but in practice an 'official' request from an IFA will probably be dealt with quicker. Down to personal requests being possibly just casual interest, but IFA requests being more formal.

Albermarle · 23 May 2019 at 1:11PM

You should be aware that the most likely scenario is as follows:
1) Cost of IFA will = 10% of the pot ( as it is not that large )
2) IFA will most likely recommend that you do not transfer out of the scheme
3) In theory you can still transfer, but a lot of pension providers will not accept a negatively advised transfer. ( you have to transfer the money to another pension provider before you can start taking the money out)

Advice4sue · 23 May 2019 at 1:59PM

‘Cost of IFA will = 10% of the pot ( as it is not that large )’
Wow 10% seems high! Would that be for just the advice? Or if I was actually able to do a transfer?
Thanks

Silvertabby · 23 May 2019 at 2:24PM

QUOTE=Advice4sue;75843904]‘Cost of IFA will = 10% of the pot ( as it is not that large )’
Wow 10% seems high! Would that be for just the advice? Or if I was actually able to do a transfer?
Thanks

That's just for the advice. And it could be more than 10% of the 'pot', as being party to a transfer out of a DB scheme (particularly a public sector scheme) is the most likely form of advice that could come back to bite the IFA on the bum years down the line.

Liability insurance has recently increased to such a degree that fewer and fewer IFAs are taking the risk of getting involved in DB transfers out.

Yes, there are some 'pension review' firms out there who will offer to do it for you - but be very aware. Many of these only set up in business when the Pension Freedoms were announced just a few years ago, and are likely to be long gone when the brown stuff starts to hit the fan in years to come.

[Deleted User] · 23 May 2019 at 2:49PM

Hello Advice4sue,
I have seen a LGPS CETV last year. I cannot remember exact figures but it was closer to 10% than it was to 20%! May have been totally different circumstances and may be different now.
Regards

Advice4sue · 23 May 2019 at 6:44PM

Thanks all for your input. Sounds like is probably left as it is. But will be interesting to see valuation when it comes

Lgps -cetv

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