Transferring out of a final salary pension scheme

[oilslick]

Chaps, could use some advice on this one before I go to an IFA.

When I first started my career I spent 4 years working for a company that had a final salary pension scheme. All future jobs I've paid into defined contribution schemes, which I've moved into a SIPP each time I've changed jobs.

I got a statement from them this week that showed my annual benefit as £1,800 assuming a retirement age of 67 (I'm 42 now).

Out of curiosity, I requested a cash-equivalent transfer value which came through as just north of £65k.

It's got me wondering if I should go see an IFA about transferring it out and into my SIPP, any thoughts welcomed?

[Stay in Bed Instead]

You may as well as it is a legal requirement to have received financial advice before the transfer can be effected.

Make sure they are appropriately authorised to provide defined benefit transfer advice.

Edited by Stay in Bed Instead on Friday 6th December 17:25

[cloud_dog]

oilslick said:

Chaps, could use some advice on this one before I go to an IFA.

When I first started my career I spent 4 years working for a company that had a final salary pension scheme. All future jobs I've paid into defined contribution schemes, which I've moved into a SIPP each time I've changed jobs.

I got a statement from them this week that showed my annual benefit as £1,800 assuming a retirement age of 67 (I'm 42 now).

Out of curiosity, I requested a cash-equivalent transfer value which came through as just north of £65k.

It's got me wondering if I should go see an IFA about transferring it out and into my SIPP, any thoughts welcomed?

Are there any guaranteed increases associated with the defered pension? Usually there are but you need to be certain.

Is the quoted figure the pension at the point of deferral or the pension at the NRA? It is usually the pension accrued at the point of leaving/deferral. It is also worth noting that usually referred DB do not update the deferred pension amount (in line with any guarantees, see question 1) until nearer your NRA. The reason for this is that the calculations can be quite involved and for them it is a cost savings position.

Is 67 the actual NRA of the scheme?

[elanfan]

Think you need to look at any other benefits associated with the Final Salary scheme - ask them for a brochure. You might find there are death benefits or payments to spouse/children. Critical illness cover etc won’t be worth a fortune but you won’t get that in your SIPP.

[anonymous-user]

A pot under £100k and below 50, sadly I can't see any advisors wanting to touch it. Blame the FCA!

[Willhire89]

janesmith1950 said:

A pot under £100k and below 50, sadly I can't see any advisors wanting to touch it. Blame the FCA!

I don't think you understood the question.....

[Mr Pointy]

Willhire89 said:

janesmith1950 said:

A pot under £100k and below 50, sadly I can't see any advisors wanting to touch it. Blame the FCA!

I don't think you understood the question.....

What do you mean?

[anonymous-user]

Willhire89 said:

janesmith1950 said:

A pot under £100k and below 50, sadly I can't see any advisors wanting to touch it. Blame the FCA!

I don't think you understood the question.....

I understood the question. My answer is that finding an advisor willing to look at it in the first place will be a tall order.

[j3ffers]

Agreed. I've got the challenge of a cash transfer value of £32k to give £1.2k in about 10 years or so. It's a small amount I wanted to consolidate into a SIPP with other DC schemes - I have no chance to get that out.