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    • By STEVE PEACOCK 8th Aug 18, 2:57 PM
    • 3Posts
    • 2Thanks
    Final salary pension or CETV ???
    • #1
    • 8th Aug 18, 2:57 PM
    Final salary pension or CETV ??? 8th Aug 18 at 2:57 PM
    I am probably in an enviable position of being financially self sufficient without my Final salary pension which is due to pay out in a few weeks on my 60th birthday. I do have a dilemma on whether or not to take the CETV option. I have been offered 676k or 22.5k p.a. and simply looking for best value future income & inheritance planning. I live an active lifestyle & in very good health with alcohol being my only unhealthy vice.
    I am considering taking 169k tax free cash which with tax benefits would cover 9 years of final salary pension equivalent (assuming 3% RPI rises). Taking further yearly amounts (approx. 11k til 67 yr old then state pension paid) to utilise my personal tax allowance. This should see me through to 72ish. Hopefully remaining monies 509k (minus approx. 80k over years to reduce tax bill) invested in a SIPP should cover ongoing pension payments. This method will reduce my tax liabilities compared to final salary pension.

    Is this sensible planning or is there more to consider (Low cost SIPP charges will be around 300/yr) and obvious risks / benefits of falling / rising stock market !!! As all money drawn from pension in early years will not be spent this will probably be futher invested in ISAs
    Last edited by STEVE PEACOCK; 08-08-2018 at 3:10 PM.
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    • Marcon
    • By Marcon 8th Aug 18, 3:45 PM
    • 560 Posts
    • 415 Thanks
    • #2
    • 8th Aug 18, 3:45 PM
    • #2
    • 8th Aug 18, 3:45 PM
    Given the size of your CETV, you must show you have received financial advice before the trustees of the DB scheme could pay a transfer. Why not do that now - your adviser is going to be hard pressed to jump through all the necessary hoops in the timescale permitted. This is normally 3 months for a statutory CETV, although from the sound of it this is a non-statutory CETV if you are within a year of the scheme's Normal Retirement Age so the timeframe might (but need not) be the same. Check with the scheme's administrators.
    • Brynsam
    • By Brynsam 8th Aug 18, 4:47 PM
    • 1,740 Posts
    • 1,276 Thanks
    • #3
    • 8th Aug 18, 4:47 PM
    • #3
    • 8th Aug 18, 4:47 PM
    Where you've posted about this before, your concern seems to be about the fees payable to an IFA, not whether to do it.

    If you are still trying to work on the CETV you were given last year, it is likely to be well and truly out of date. If your scheme has a retirement date of 60 (?unless you are retiring early), are you sure the trustees will let you transfer so close to that date? You may have missed the boat on that one.
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