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  • FIRST POST
    • PlanToRetire
    • By PlanToRetire 14th Jan 20, 7:13 PM
    • 17Posts
    • 20Thanks
    PlanToRetire
    Possible Transfer Value and Advice
    • #1
    • 14th Jan 20, 7:13 PM
    Possible Transfer Value and Advice 14th Jan 20 at 7:13 PM
    Good evening, I need some help with a possible Final Salary Pension Scheme Transfer.
    I am 54, and my husband has just retired. I have 3 smaller pensions to the value of about 100,000. My main scheme is a Final Salary and I am thinking of taking it at 55. However I will probably still work part time. If I leave the pension where it is, at 55 I can get a lump sum of 67.5k and a pension of 10k per year.
    The estimated transfer value is 498k and I am considering transferring to a drawdown arrangement. I work for an Investment Company and they offer Pension help, although it does seem to be more Wealth Management. I had the initial consultation with this Company today. However my issue is that they will make a recommendation re the transfer – but if they recommend not to transfer then I can not go ahead with them. The fee of 1% (5k) still needs to be paid.
    Obviously I will consider carefully the advice given, but if I go through this process and the recommendation is not to transfer then if I do decide to go ahead then I will need to do through the whole process again.
    I looked into this 2 years ago with my previous employer and I decided not to proceed after getting the initial Transfer Value (which was 75k lower), but I do remember that if I decided to transfer regardless of the advice the Financial Advisor would proceed on my behalf
    So my first question is this:

    Is it usual for an Advisor to not assist with a Transfer if they recommend not to transfer?

    As I said, I am prepared to pay for advice, however I know that the Advisor will err on the side of caution – which is understandable – but I feel that if I do decide to Transfer I will have to pay the first Advisor and still be in the same position.

    Therefore the next question is 1% of the Transfer Value reasonable?

    Any help would be most appreciated
Page 1
    • dmelife
    • By dmelife 14th Jan 20, 10:39 PM
    • 126 Posts
    • 124 Thanks
    dmelife
    • #2
    • 14th Jan 20, 10:39 PM
    • #2
    • 14th Jan 20, 10:39 PM
    Yes and yes!
    • dmelife
    • By dmelife 14th Jan 20, 10:40 PM
    • 126 Posts
    • 124 Thanks
    dmelife
    • #3
    • 14th Jan 20, 10:40 PM
    • #3
    • 14th Jan 20, 10:40 PM
    Just get them to agree that they will sign an advice declaration and then find a provider who will except a transfer in without positive advice.
    • sandsy
    • By sandsy 15th Jan 20, 7:45 AM
    • 1,539 Posts
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    sandsy
    • #4
    • 15th Jan 20, 7:45 AM
    • #4
    • 15th Jan 20, 7:45 AM

    Is it usual for an Advisor to not assist with a Transfer if they recommend not to transfer?
    Originally posted by PlanToRetire
    It's very common. Many advisers feel that if they've given you professional advice not to do something, it would be unethical to help you do something that is not in your best interests.

    Would you act against your doctor or solicitor's advice?

    Therefore the next question is 1% of the Transfer Value reasonable?
    Originally posted by PlanToRetire
    1%/5k is not untypical of the level of advice fees for this type of advice at the moment.
    • PlanToRetire
    • By PlanToRetire 15th Jan 20, 9:13 AM
    • 17 Posts
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    PlanToRetire
    • #5
    • 15th Jan 20, 9:13 AM
    • #5
    • 15th Jan 20, 9:13 AM
    It's very common. Many advisers feel that if they've given you professional advice not to do something, it would be unethical to help you do something that is not in your best interests.
    Would you act against your doctor or solicitor's advice?
    1%/5k is not untypical of the level of advice fees for this type of advice at the moment.
    Originally posted by sandsy
    Many thanks both.

    Sandsy – I agree and understand why they would not proceed against recommendations.

    However, my point is that the advice will (understandably) be cautious. What I want to do is listen to their advice, consider it, then decide how to proceed. If the recommendation is not to transfer I will take that on board but may still decide to go out. In which case I would need to find a new Advisor – after paying the first on 5k. I’m not saying that they didn’t earn this money or give good advice, but to keep my options open, aren’t I best finding an advisor who will proceed with my wishes regardless of if its against their recommendation?

    I work in central London, so they are plenty of IFAs in the area. They all offer a free first consultation so i think I will make an appointment. I haven’t dealt with an IFA before, so I need to know what to expect and a rough idea of cost. I should make it clear – I don’t begrudge paying for knowledge and advice, but I don’t want to restrict myself to someone who will not be able to carry out my (possible) wishes in the future.

    To be honest I felt the advisor who I spoke to yesterday was more a Wealth Management specialist, whereas I think I need Pensions Advice – not just one off about the Final Salary Scheme but ongoing for the rest of my life.
    • Dazed and confused
    • By Dazed and confused 15th Jan 20, 9:24 AM
    • 6,193 Posts
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    Dazed and confused
    • #6
    • 15th Jan 20, 9:24 AM
    • #6
    • 15th Jan 20, 9:24 AM
    If the recommendation is not to transfer I will take that on board but may still decide to go out. In which case I would need to find a new Advisor after paying the first on 5k.
    Why do you need to find a new advisor?
    • PlanToRetire
    • By PlanToRetire 15th Jan 20, 9:29 AM
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    PlanToRetire
    • #7
    • 15th Jan 20, 9:29 AM
    • #7
    • 15th Jan 20, 9:29 AM
    Why do you need to find a new advisor?
    Originally posted by Dazed and confused
    I thought you had to have an Advisor to proceed with a Pension Transfer? So if my work Advisor does not recommend that I transfer I thought that I had to find someone else to help me with this? Or have I misunderstood?
    • Dazed and confused
    • By Dazed and confused 15th Jan 20, 9:33 AM
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    Dazed and confused
    • #8
    • 15th Jan 20, 9:33 AM
    • #8
    • 15th Jan 20, 9:33 AM
    I think you've misunderstood.

    You will be much more limited in your initial choice of providers if you want to proceed against the recommendation but I think some will still accept the transfer. Possibly AJ Bell?

    And once the initial transfer is done you now have a SIPP, not a DB pension so may (not 100% certain) be able to simply move your SIPP to any provider of your choice.
    • Peter314
    • By Peter314 15th Jan 20, 9:36 AM
    • 57 Posts
    • 44 Thanks
    Peter314
    • #9
    • 15th Jan 20, 9:36 AM
    • #9
    • 15th Jan 20, 9:36 AM
    You are required to take advice from a pension transfer specialist. Having done so (and got a signature from the advisor to that effect) you can do the rest yourself if you wish.

    Some pension companies will only accept transfers where the advice has been to transfer. Others do not require this. One such is AJ Bell but I'm sure there will be others.
    • jimi_man
    • By jimi_man 15th Jan 20, 9:39 AM
    • 265 Posts
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    jimi_man
    From reading other threads on here, it seems that you are required to obtain advice, but not necessarily obliged to take it. So presumably you'd find a company that does transfers with a negative recommendation (I believe there are a few - AJ Bell has been mentioned on other threads) and use them. I guess they only require that you have sought advice, not that you are acting on it.

    Personally I think the system is a bit stupid really. These safeguards were brought in to stop people doing daft things, and yet all people seem to be doing is getting the advice, ignoring it and doing the transfer anyway against the advice. Eventually it will go wrong for someone and there will be a furore, they will claim against all and sundry and the subject will be revisited I suspect. Until then...
    • Dazed and confused
    • By Dazed and confused 15th Jan 20, 9:43 AM
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    Dazed and confused
    I suspect all it will take is a significant market crash, nothing out of the ordinary, just similar to those seen in the past and we will move into "PPI" territory.

    At which point people like the op (no offence intended) will start to plead they were misled. Hopefully there will be sufficient audit trail nowadays to show they were going against the professional advice to stay put.
    • Albermarle
    • By Albermarle 15th Jan 20, 9:53 AM
    • 2,214 Posts
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    Albermarle
    If you go ahead with the current advisor, then check in advance that if it is a negative recommendation they will be still happy to sign a declaration that you have been through the correct process.
    As long as they do this , then as said above , you can still transfer out of the DB scheme , without the need for any further advice or fees. In the jargon you will be known as an 'insistent client'

    Although it seems you have made your mind up , might be worth looking at this .

    https://www.royallondon.com/siteassets/site-docs/media-centre/good-with-your-money-guides/five-good-reasons-good-with-your-money-guide-2018-edition.pdf
    • PlanToRetire
    • By PlanToRetire 15th Jan 20, 9:58 AM
    • 17 Posts
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    PlanToRetire
    I suspect all it will take is a significant market crash, nothing out of the ordinary, just similar to those seen in the past and we will move into "PPI" territory.
    At which point people like the op (no offence intended) will start to plead they were misled. Hopefully there will be sufficient audit trail nowadays to show they were going against the professional advice to stay put.
    Originally posted by Dazed and confused
    None taken! As I’ve said, I want advice but I don’t want to be bound by it so would like to have the freedom to make my own choice if applicable, without any comeback to the Advisor obviously. I t would be my decision.

    Thanks for the info.

    I think I will still speak to an IFA, just to get another perspective, I don’t think the work guy is really a fit for what I want.
    Last edited by PlanToRetire; 15-01-2020 at 10:02 AM.
    • PlanToRetire
    • By PlanToRetire 15th Jan 20, 10:01 AM
    • 17 Posts
    • 20 Thanks
    PlanToRetire
    If you go ahead with the current advisor, then check in advance that if it is a negative recommendation they will be still happy to sign a declaration that you have been through the correct process.
    As long as they do this , then as said above , you can still transfer out of the DB scheme , without the need for any further advice or fees. In the jargon you will be known as an 'insistent client'

    Although it seems you have made your mind up , might be worth looking at this .
    Originally posted by Albermarle
    Thank you. I haven't made up my mind. I just don't want to box myself in.

    I will take on board all guidance, as I said I do think the recommendation will be a cautious one, which is understandable.
    • MallyGirl
    • By MallyGirl 15th Jan 20, 10:09 AM
    • 4,134 Posts
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    MallyGirl
    sounds sensible. you just need to find an IFA who is a pensions transfer specialist and, during your free consult, ask whether they will still sign the advice report even if the advice is not to transfer. You need a report - not necessarily a positive report - and then you can transfer to AJ Bell as an insistent client. Once with AJ Bell you can, at a later date, transfer elsewhere if they are not the best fit - you will be out of the restriction by then.
    • jimi_man
    • By jimi_man 15th Jan 20, 10:41 AM
    • 265 Posts
    • 350 Thanks
    jimi_man
    Presumably, if the decision of whether to transfer is going to be the OPs alone and will be made irrespective of any professional advice, then it doesn't actually matter who is used, other than they fit the criteria for completing the work and therefore just go for the cheapest possible.

    Makes me think that there is a market opening for such a person, who will always give negative recommendations and can charge much less than other people. It doesn't seem that there would be any liability involved as it's a negative recommendation, but the criteria for taking advice has been fulfilled!
    • PlanToRetire
    • By PlanToRetire 15th Jan 20, 10:46 AM
    • 17 Posts
    • 20 Thanks
    PlanToRetire
    Presumably, if the decision of whether to transfer is going to be the OPs alone and will be made irrespective of any professional advice, then it doesn't actually matter who is used, other than they fit the criteria for completing the work and therefore just go for the cheapest possible.

    Makes me think that there is a market opening for such a person, who will always give negative recommendations and can charge much less than other people. It doesn't seem that there would be any liability involved as it's a negative recommendation, but the criteria for taking advice has been fulfilled!
    Originally posted by jimi_man
    I agree - if you decide to set up such a company I am happy to be your first customer - for a small fee obvs!
    • MallyGirl
    • By MallyGirl 15th Jan 20, 10:54 AM
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    MallyGirl
    The problem is the cost of the insurance I believe. I am pretty sure there have been cases of negative recommendation, insistent client transfer, it all goes pear-shaped and the client still successfully claimed against the advisor who told not to transfer.
    • Albermarle
    • By Albermarle 15th Jan 20, 10:56 AM
    • 2,214 Posts
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    Albermarle
    I think I will still speak to an IFA, just to get another perspective, I don’t think the work guy is really a fit for what I want.
    Just be aware that finding the right type of IFA , with the right qualifications , who is willing to do the work can be difficult . So might be easier to stick with the work one . As already said.
    Presumably, if the decision of whether to transfer is going to be the OPs alone and will be made irrespective of any professional advice, then it doesn't actually matter who is used,
    • Albermarle
    • By Albermarle 15th Jan 20, 10:57 AM
    • 2,214 Posts
    • 1,454 Thanks
    Albermarle
    The problem is the cost of the insurance I believe. I am pretty sure there have been cases of negative recommendation, insistent client transfer, it all goes pear-shaped and the client still successfully claimed against the advisor who told not to transfer.
    Which is also why most mainstream pension/SIPP providers will not accept a transfer from an insistent client .
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