Defined Benefit Transfers

Our view is that the value of benefits held within a Defined Benefit Scheme (often referred to as Final Salary) are in the vast majority of cases, more valuable than the transfer value offered by these schemes. There are circumstances where we will consider advising on a transfer out of a scheme based on meeting the following criteria.

We will only consider advising on a transfer where the scheme member is over age 50, and the Cash Equivalent Transfer Value offered exceeds £400,000.

We will also consider advising on a transfer where an individual has serious ill health which is likely to severely curtail their lifespan – even if the value is below £400,000.

Prior to considering a transfer, and before we are able to provide specific advice, you would need to read through and confirm that you understand our Triage Document. You will also be asked to confirm that you have read and understood the information provided on the following websites.

https://www.fca.org.uk/consumers/pension-transfer-defined-benefit

https://www.pensionsadvisoryservice.org.uk/about-pensions/when-things-change/when-relationships-end/things-to-think-about

We would also strongly recommend that you call the freephone number provided by the Pensions Advisory Service who offer a free consultation, which will provide you with generic guidance. Their contact number is 0800 011 3797.

We will ask you to confirm either in writing or by email, that you have undertaken the aforementioned before we will consider providing advice. We are able to provide generic guidance in relation to the benefits of these types of schemes prior to any advice being given, but this will not be specific to your personal situation or needs.

If following the above undertaking, you decide to proceed further, we will consider providing advice, and the following process will apply.

Abridged advice.

This first stage will be an initial assessment to establish whether it is in your interests to receive full pension transfer advice. This will involve undertaking a detailed, in-depth analysis of your personal and financial circumstances, including your specific reasons for wanting to consider the transfer. It will also involve discussions around your attitude to and experience of investment risk, your retirement income needs and discussions around how your needs could be met. We would also need to obtain detailed information from the scheme you are considering a transfer from.

Following this initial assessment, we will advise you in writing of one of two outcomes.

Outcome 1 – This will be that you should NOT transfer your Defined Benefit Pension.

If our advice is that you should NOT transfer, we will clearly document our reasons why this is the case and the risks involved in transferring. In exceptional circumstances, we may be willing to proceed with the next stage against our recommendations, if this is specifically requested and we can be convinced of the merits of wanting to do so. However, this will be at our sole discretion, and we cannot guarantee to undertake this for you.

Outcome 2 – It is unclear whether you would benefit from a transfer

If the initial outcome is that it is unclear and the reason for this has been explained, you will then have the option of proceeding to a further stage in the advice process which will incur additional fees.

The fees payable for the Abridged advice stage described will be £1,000 regardless of whether you proceed to the next advice stage.

Please note – You have the right to forego the abridged advice process and request full advice if preferred.

Full advice

If you decide to proceed to Full Advice in relation to the suitability of a transfer, using the information obtained from the scheme, we will undertake an Appropriate Pension Transfer Analysis (APTA) which would include a Transfer Value Comparator (TVC). These reports are a regulatory requirement and aim to provide a comparison between the benefits being considered for transfer against the benefits afforded under a Personal Pension. We would also be required to obtain information from your current workplace pension or a previous workplace pension scheme, as this would need to be considered as the most suitable scheme to receive the transfer.

Using the information obtained and taking into account your individual specific circumstances, we would then provide you with a further detailed report in relation to the suitability of a transfer.

Regardless of whether the outcome of this process is a recommendation to transfer or not, a fee will be payable by you directly for this advice.

This fee will be charged at an hourly rate of £300 an hour. It is estimated that it will take between 10 – 15 hours to undertake the research and analysis and provide written recommendations. Therefore, the estimated cost for this will be in the region of £3,000 – £4,500. There will be a maximum charge cap for this of £4,500. If abridged advice has already been provided and charged for, the cost of this will be offset against the Full Advice fee representing the fact that some of the work required for the second stage will already have been undertaken.

Additional fees are likely to apply for ongoing advice in relation to the transferred funds if a transfer proceeds and examples of these are provided within our client service agreement. These would be fully disclosed and detailed in our recommendations.

“THIS ADVICE PROCESS IS NOT FREE! YOU WILL HAVE TO PAY A FEE WHETHER A TRANSFER PROCEEDS OR NOT. WE RESERVE THE RIGHT NOT TO PROCESS A TRANSFER IF IT IS AGAINST OUR ADVICE”