This article was last updated on 1 September 2021.
You may want to transfer your final salary or defined benefit pension for a variety of reasons. Although transferring can be financially beneficial, the process complicated. The transfer can be to another employer, or if done at retirement it could be to something like an income drawdown product.
So, the decision to transfer should not be made lightly especially in light of potential pension transfer advice fees.
This article outlines some things you should consider before making a pension transfer from a defined benefit pension scheme rather than a defined contribution scheme.
We also look at the what you may be looking at when it comes to the final salary pension transfer advice cost.1
To help with your decision, it is a good idea to get financial advice from a pension transfer specialist. Whilst costs can seem expensive it can be possible to get low cost pension transfer advice or even fixed fee pension transfer advice.
You might need to speak to a regulated financial advisor:
Speaking to a regulated financial advisor ensures you are protected if things go wrong, as you’ll be able to use the available complaints and compensation schemes.
Advising on defined benefit pension schemes is a specialist area, whether that be taking early retirement, ill-health retirement or normal retirement. Advisers must meet the qualification requirements set by the FCA. This means support in this area will not be cheap. Such charges vary, depending on factors like:
Although the cheapest pension transfer advice cost can differ, as a ballpark:
Given the cost of pension transfer advice, it is worth exploring these low cost pension transfer advice possibilities before contacting a private adviser:
As well as informing you on the pros and cons of transferring your pension, you can expect your adviser to:
A SIPP is a self-invested personal pension. It offers more freedom of investment than you would have from a traditional personal pension provider. Most schemes will allow you to transfer to SIPP, but:
You are eligible to transfers if:
If you decide to transfer, it is important to understand your transfer value. This is to make sure you’re getting a good deal:
Before transferring, you must apply for a cash equivalent transfer value statement or a CETV. The CETV will:
It is an important piece of information:
It is also possible to calculate your CETV yourself. This way you can get a rough estimate of the benefits of transferring. You can use online calculators such as this one to do so – https://www.finalsalarytransfer.com/p/67/db-pension-transfer-value-calculator
These calculators provide a realistic estimate, but they should not be used as a replacement for professional help.
Most pension plans will allow you to transfer your pension to another pension scheme, either:
You can generally transfer at any time up to a year before you are due to start drawing retirement benefits. However:
The process is complicated and governed by a strict set of rules designed to protect you. So, it is a good idea to seek advice from a regulated financial adviser.
It is possible to move a pension from an old employer at any time. The more pensions you have, the more it might be advisable to move them into one so you avoid losing any.
If you think you might have already lost track of a pension, you can use the governments Pension Tracing service to find it
If someone contacts you unexpectedly and says they can help you to transfer your pension it is likely to be a scam.
You can read more about how to spot a scam at https://www.moneyadviceservice.org.uk/en/articles/how-to-spot-a-pension-scam
You can also get free and impartial information about moving your pension from:
If you do decide to seek private financial help, it is important that you find the best financial adviser for you. Before appointing an adviser, you should:
We are able to help you if meet the following criteria:
1 – You are resident in the UK; and
2 – If you want to transfer a defined benefit / final salary pension you are aged 54 or over, There are no age limits if you want to transfer a defined contribution / money purchase pension; and
3 – Your pension transfer value is £75K or over
If you meet the criteria, and would like some help, you can contact us in one of 3 ways:
Leave your contact details below and one of the team will give you a call to discuss your needs.
Please note that all calls are undertaken by BP Sanders & Company Limited who are an appointed representative of Quilter Financial Limited, which is authorised and regulated by the Financial Conduct Authority.