Transfer of DB pension by Fidelity - any experience?
Discussion
I have one small DB pension outstanding in my portfolio; by "outstanding", I mean that it's still in place, I haven't drawn anything from it and I haven't transferred it out. I recently requested a CETV which came out at around 32x pension, and given that I'm 60 (and retired) I'm minded to transfer it out. I do (I believe!) understand the ramifications of a transfer, as I have already transferred out one large DB pension which made up around 2/3 of my overall pot in the end. This one is large enough to require approval to transfer, and is equal to 10% of my existing pension pot.
I went back to the advisor who handled my previous, large DB transfer and they told me very frankly that whilst they would love to help, their fee structure had changed due to compliance and PI issues and that their standard fee was now £8500. That's a lot more (3x) than I paid for the much larger transfer. He apologised for this, but suggested that I speak to Fidelity as he believed they were able to offer a lower charge, probably due to economy of scale etc.
I contacted Fidelity and they told me over the phone that they make no charge for transferring a DB pension, and their only charge is a 0.35% (yes, zero point three five, I asked them to confirm this three times on the call) annual fee. No transfer-out charges once the funds are with them either (because that's what I will want to do, move it to where the rest of my pension is). I do wonder whether the person I spoke to actually knows what a DB pension is and understands the controls around them.
Up until now I have never felt uncomfortable with any of the dealings I've had with any of my pensions and I've made my decisions and proceeded accordingly. However, this just makes me feel very uneasy! I can't believe there is not a catch of some sort. OK, Fidelity are a large organisation and not likely to put my cash towards a gin palace and disappear, but the old "if it looks too good to be true, it probably is" adage springs to mind.
So, has anyone used them for this and how did it play out? And conversely, can anyone recommend a good, but well-priced, DB transfer advisor?
TIA.
I went back to the advisor who handled my previous, large DB transfer and they told me very frankly that whilst they would love to help, their fee structure had changed due to compliance and PI issues and that their standard fee was now £8500. That's a lot more (3x) than I paid for the much larger transfer. He apologised for this, but suggested that I speak to Fidelity as he believed they were able to offer a lower charge, probably due to economy of scale etc.
I contacted Fidelity and they told me over the phone that they make no charge for transferring a DB pension, and their only charge is a 0.35% (yes, zero point three five, I asked them to confirm this three times on the call) annual fee. No transfer-out charges once the funds are with them either (because that's what I will want to do, move it to where the rest of my pension is). I do wonder whether the person I spoke to actually knows what a DB pension is and understands the controls around them.
Up until now I have never felt uncomfortable with any of the dealings I've had with any of my pensions and I've made my decisions and proceeded accordingly. However, this just makes me feel very uneasy! I can't believe there is not a catch of some sort. OK, Fidelity are a large organisation and not likely to put my cash towards a gin palace and disappear, but the old "if it looks too good to be true, it probably is" adage springs to mind.
So, has anyone used them for this and how did it play out? And conversely, can anyone recommend a good, but well-priced, DB transfer advisor?
TIA.
I suspect there was a misunderstanding on either your part or Fidelity’s part.
I can believe Fidelity charge 0.35% pa (my SIPP which I used for consolidating various old DC pensions is with them, and I think that’s what I am charged).
However, I didn’t think they accepted transfers from DB. And I’m pretty sure they wouldn’t provide the advice. That is, if they did accept the DB transfer, you would have to get separate advice which would allow you to transfer your DB pension. You would have to pay for that advice and then Fidelity would charge 0.35% pa on the funds transferred to them.
I can believe Fidelity charge 0.35% pa (my SIPP which I used for consolidating various old DC pensions is with them, and I think that’s what I am charged).
However, I didn’t think they accepted transfers from DB. And I’m pretty sure they wouldn’t provide the advice. That is, if they did accept the DB transfer, you would have to get separate advice which would allow you to transfer your DB pension. You would have to pay for that advice and then Fidelity would charge 0.35% pa on the funds transferred to them.
I use Fidelity, though not for a pension. They're fine, a massive outfit, and the platform fee is 0.2% over £250K.
But if your pension needs an Advisor to shift it, then it needs an Advisor. Vanguard are offering this service, but you can only invest in Vanguard funds. Fidelity don't (yet) offer an Advised service.
If you don't need an Advisor, then all bets are on. You could move it to Fidelity, who have a massive range of funds to choose from (not just their on), and shares, or Intelligent Money who have a reputation for being very helpful.
It is quite a thing, when you're used to paying a 'professional' to move your dosh around, to move it yourself. Suddenly you realise how much money you're handling!
But if your pension needs an Advisor to shift it, then it needs an Advisor. Vanguard are offering this service, but you can only invest in Vanguard funds. Fidelity don't (yet) offer an Advised service.
If you don't need an Advisor, then all bets are on. You could move it to Fidelity, who have a massive range of funds to choose from (not just their on), and shares, or Intelligent Money who have a reputation for being very helpful.
It is quite a thing, when you're used to paying a 'professional' to move your dosh around, to move it yourself. Suddenly you realise how much money you're handling!
Edited by Simpo Two on Wednesday 21st April 20:38
Zigster said:
I suspect there was a misunderstanding on either your part or Fidelity’s part.
I can believe Fidelity charge 0.35% pa (my SIPP which I used for consolidating various old DC pensions is with them, and I think that’s what I am charged).
However, I didn’t think they accepted transfers from DB. And I’m pretty sure they wouldn’t provide the advice. That is, if they did accept the DB transfer, you would have to get separate advice which would allow you to transfer your DB pension. You would have to pay for that advice and then Fidelity would charge 0.35% pa on the funds transferred to them.
Definitely not a misunderstanding from me! I've been through a DB transfer previously and I know what's involved. I explained to the Fidelity person on the phone several times that it is a DB pension and asked what fees for that were and she stated several times that there was no fee. I don't believe that either....I can believe Fidelity charge 0.35% pa (my SIPP which I used for consolidating various old DC pensions is with them, and I think that’s what I am charged).
However, I didn’t think they accepted transfers from DB. And I’m pretty sure they wouldn’t provide the advice. That is, if they did accept the DB transfer, you would have to get separate advice which would allow you to transfer your DB pension. You would have to pay for that advice and then Fidelity would charge 0.35% pa on the funds transferred to them.
Interesting if they don't actually accept DB transfers. As per my OP, I was put onto Fidelity by the guy who did my previous transfer. In that case the sum he charged me was a very small percentage of the pot value but in this case he said that his fees had been put up by his compliance and PI teams, and given that this DB is significantly less than the previous one, the sums don't really add up. It comes out at nearly 10%. I do want it transferred out though, I understand the ramifications and I know why I want to do it, but it's well above the FSA threshold for requiring advice.
Simpo Two said:
I use Fidelity, though not for a pension. They're fine, a massive outfit, and the platform fee is 0.2% over £250K.
But if your pension needs an Advisor to shift it, then it needs an Advisor. Vanguard are offering this service, but you can only invest in Vanguard funds. Fidelity don't (yet) offer an Advised service.
If you don't need an Advisor, then all bets are on. You could move it to Fidelity, who have a massive range of funds to choose from (not just their on), and shares, or Intelligent Money who have a reputation for being very helpful.
It is quite a thing, when you're used to paying a 'professional' to move your dosh around, to move it yourself. Suddenly you realise how much money you're handling!
Re the point in bold above, I'll have to call them back and ask again; perhaps I'll get through to someone else who does understand my question. That said, I was specifically told by a DB transfer advisor that Fidelity DO offer that. But if your pension needs an Advisor to shift it, then it needs an Advisor. Vanguard are offering this service, but you can only invest in Vanguard funds. Fidelity don't (yet) offer an Advised service.
If you don't need an Advisor, then all bets are on. You could move it to Fidelity, who have a massive range of funds to choose from (not just their on), and shares, or Intelligent Money who have a reputation for being very helpful.
It is quite a thing, when you're used to paying a 'professional' to move your dosh around, to move it yourself. Suddenly you realise how much money you're handling!
Edited by Simpo Two on Wednesday 21st April 20:38
Thanks both for the responses. If this doesn't work out I'll need to find a DB advisor who can work this through with me, at a respectable rate - if anyone knows of someone, please let me know!
From Fidelity's own factsheet in relation to DB transfers:
For transfers containing the above, we will require confirmation that
you have received appropriate financial advice and that the advice
confirmed it was in your best interests to transfer. Without this, the
transfer to us cannot proceed.
You will require a positive recommendation to transfer from an IFA that is qualified to advise on Transfers.
For transfers containing the above, we will require confirmation that
you have received appropriate financial advice and that the advice
confirmed it was in your best interests to transfer. Without this, the
transfer to us cannot proceed.
You will require a positive recommendation to transfer from an IFA that is qualified to advise on Transfers.
55palfers said:
All things being equal, wouldn't the "advice" you received for your first transfer still hold good?
£8500 is a crazy amount of money.
I did ask but apparently if they had been done together at the time then yes, but not now, unfortunately. £8500 is a crazy amount of money.
I agree, it's ridiculous money, particularly given that I know what's involved now in terms of time and effort, but a shrinking provider base and massive hikes in PI are really deterring everyone from going through with it.
darreni said:
From Fidelity's own factsheet in relation to DB transfers:
For transfers containing the above, we will require confirmation that
you have received appropriate financial advice and that the advice
confirmed it was in your best interests to transfer. Without this, the
transfer to us cannot proceed.
You will require a positive recommendation to transfer from an IFA that is qualified to advise on Transfers.
Ah, that seems pretty conclusive then. I've had involvement with Fidelity in the past, both as an investor and for other reasons as well and I have never been less than disappointed with them. In this case I would only have used them to get his transfer through, and then bailed. For transfers containing the above, we will require confirmation that
you have received appropriate financial advice and that the advice
confirmed it was in your best interests to transfer. Without this, the
transfer to us cannot proceed.
You will require a positive recommendation to transfer from an IFA that is qualified to advise on Transfers.
When I closed my investment account with them some time back, I asked them to remove all my PII from their systems but when I went through the pensions application form and entered my NI number, they miraculously knew who I was. I think I'll need to be looking into the fact that they are providing misleading information over the phone (presumably that has to be regulated, and therefore correct?) along with their GDPR responsibilities.
CharlesElliott said:
I think Fidelity are giving you the transfer in charges *once you have received the signed off financial advice* from a qualified advisor. They are not able to offer that advice themselves.
That makes perfect sense, but I explained clearly to the call centre person who took my call what my requirement was, and then subsequently asked them to confirm that three separate times during the call. Very poor show on their part, it's like they have flannelled me to get me to open an account.Not what I'd consider very compliant!
CAPP0 said:
CharlesElliott said:
I think Fidelity are giving you the transfer in charges *once you have received the signed off financial advice* from a qualified advisor. They are not able to offer that advice themselves.
That makes perfect sense, but I explained clearly to the call centre person who took my call what my requirement was, and then subsequently asked them to confirm that three separate times during the call. Very poor show on their part, it's like they have flannelled me to get me to open an account.Anyway, if you don't like Fidelity, why not call Vanguard who do offer the advice? (and have well respected funds).
darreni said:
Simpo Two said:
You never know, maybe it could have slipped in due to an unfortunate clerical error etc...
Anyway, if you don't like Fidelity, why not call Vanguard who do offer the advice? (and have well respected funds).
No they don’t. Anyway, if you don't like Fidelity, why not call Vanguard who do offer the advice? (and have well respected funds).
darreni said:
Simpo Two said:
Anyway, if you don't like Fidelity, why not call Vanguard who do offer the advice? (and have well respected funds).
No they don’t. https://citywire.co.uk/new-model-adviser/news/vang...
Whilst Fidelity might be " safe " and do indeed have a lot of Funds to choose from if my recent experience of trying to get my wife's various Investment Funds sold and the proceeds reinvested elsewhere is anything to go by I certainly wouldn't be transferring in and playing around with pensions.
They gave incorrect valuations to the new company and made a complete farce of the actual sale transactions and prior was always ( especially through Covid ) very difficult to get responses from.
The only good part of the entire transaction was that post my complaint all the charges were refunded along with a very small compensation payment.
They gave incorrect valuations to the new company and made a complete farce of the actual sale transactions and prior was always ( especially through Covid ) very difficult to get responses from.
The only good part of the entire transaction was that post my complaint all the charges were refunded along with a very small compensation payment.
A friend of mine used the firm below for DB transfer analysis last year and paid around £3k, although I understand their prices have since risen:
https://www.ljfp.co.uk/
https://www.ljfp.co.uk/
Despite the clumsiness of the call-centre person I spoke to, this link suggests (down towards the bottom of the page) that Fidelity do offer that service, as a fixed fee product.
There's also a curious comment there:
There's also a curious comment there:
Fidelity said:
The advice fee will apply, regardless of the outcome. You will however receive a Financial Advice Certificate which may enable you to release your transfer to an alternative pension provider if you still wish to proceed against Fidelity’s advice.
My bold. Surely the (regulated) advice should/would be the same from any advisor, and equally, if Fidelity say no, why would another pension provider accept that as approval to proceed? Gassing Station | Finance | Top of Page | What's New | My Stuff