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to transfer or not transfer that is the question

stooz
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to transfer or not transfer that is the question

#347750

Postby stooz » October 14th, 2020, 8:08 pm

I have an old pension thats only worth 2k a year as a pension - and its one of those old school safe investment things which makes it quiet secure.

However they give it a value of £250k which sounds to me a better bet to transfer to a private pension and then drawdown as much as possible and live of the 'winnings'
even paying the tax at getting more.
My idea that it is an amount I could live on for years or invest for prfit to live on for longer
or take 25% to live on for year or 2 and leave the rest in that pot

I think the swinger is the saftey net and the fact it gives a spouse pension as well - which my current private pot would not.

I know I need to talk to a FA but I thought I might canvas some other opinions than just the one.

mc2fool
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Re: to transfer or not transfer that is the question

#347754

Postby mc2fool » October 14th, 2020, 8:22 pm

stooz wrote:I have an old pension thats only worth 2k a year as a pension...

However they give it a value of £250k which sounds...

Astounding -- or a mistake. Before you do anything else I'd suggest asking them to double check and confirm, or otherwise, those figures!

Arborbridge
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Re: to transfer or not transfer that is the question

#347762

Postby Arborbridge » October 14th, 2020, 8:39 pm

stooz wrote:I have an old pension thats only worth 2k a year as a pension - and its one of those old school safe investment things which makes it quiet secure.

However they give it a value of £250k which sounds to me a better bet to transfer to a private pension and then drawdown as much as possible and live of the 'winnings'
even paying the tax at getting more.
My idea that it is an amount I could live on for years or invest for prfit to live on for longer
or take 25% to live on for year or 2 and leave the rest in that pot

I think the swinger is the saftey net and the fact it gives a spouse pension as well - which my current private pot would not.

I know I need to talk to a FA but I thought I might canvas some other opinions than just the one.


It makes no sense. A 2k pension needs a far smaller pot, so it's out by a factor of ?5?

Snorvey
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Re: to transfer or not transfer that is the question

#347775

Postby Snorvey » October 14th, 2020, 9:25 pm

mc2fool wrote:
stooz wrote:I have an old pension thats only worth 2k a year as a pension...

However they give it a value of £250k which sounds...

Astounding -- or a mistake. Before you do anything else I'd suggest asking them to double check and confirm, or otherwise, those figures!


Agreed. 125x is astounding. Take it!

Lanark
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Re: to transfer or not transfer that is the question

#347777

Postby Lanark » October 14th, 2020, 9:29 pm

It must have that value for a reason, is it index linked?

swill453
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Re: to transfer or not transfer that is the question

#347797

Postby swill453 » October 14th, 2020, 10:24 pm

Lanark wrote:It must have that value for a reason, is it index linked?

Most DB pensions are, but anything over a 30x multiple is starting to be generous.


Scott.

stooz
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Re: to transfer or not transfer that is the question

#347808

Postby stooz » October 14th, 2020, 10:39 pm

I will check those figures........

xxd09
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Re: to transfer or not transfer that is the question

#347833

Postby xxd09 » October 15th, 2020, 12:06 am

You could safely get £7000 pa from a stocks and shares portfolio of £250000 and keep the capital intact(in fact it will probably grow)
Is that enough to compensate for “safety “ and a wife’s pension?
Probably-if you have some knowledge of investing
You have to then manage the investment/pension yourself -are you knowledgeable enough to do this?
It then passes to your wife or your heirs on your death
xxd09

xxd09
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Re: to transfer or not transfer that is the question

#347836

Postby xxd09 » October 15th, 2020, 12:25 am

Currently a primer on the whole pension transfer process posted on Monevator.com
Well worth a read for an investor in your position
Gives chapter and verse
xxd09

stooz
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Re: to transfer or not transfer that is the question

#349329

Postby stooz » October 20th, 2020, 9:00 pm

Ok. I've checked. Sorry. It's a value of £174k to a pension of £2865.00 a year
It's adb. But like you suggest I will never get my 174k back in my life time, so having it in my own bank/investment is my preference

Alaric
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Re: to transfer or not transfer that is the question

#349336

Postby Alaric » October 20th, 2020, 9:17 pm

stooz wrote: It's a value of £174k to a pension of £2865.00 a year


That's still an eye watering multiplier. You may still want to check what they mean by £ 2865 a year. Defined Benefit income amounts are usually revalued with inflation from when you left the scheme to when you eventually retire. Depending on when they measure the £ 2865, it might be quite a bit more when you reach retirement age.

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Re: to transfer or not transfer that is the question

#349635

Postby 2boi » October 21st, 2020, 6:29 pm

yes its a multiplier of 61 times , seems high. I have the same issue my multiplier is 40 to 50x. Good luck with the FA though they they will want £5,220/3% to sign off the transfer and you can't transfer without their sign off.

YeeWo
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Re: to transfer or not transfer that is the question

#358834

Postby YeeWo » November 21st, 2020, 5:15 pm

A colleague has a similar dilemma, £4.5k pa at 60 or £189k transfer value now. He would like to transfer!

Can anybody recommend an IFA who would do the necessary and advise the costs involved........?

PhaseThree
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Re: to transfer or not transfer that is the question

#358839

Postby PhaseThree » November 21st, 2020, 5:30 pm

YeeWo wrote:A colleague has a similar dilemma, £4.5k pa at 60 or £189k transfer value now. He would like to transfer!

Can anybody recommend an IFA who would do the necessary and advise the costs involved........?


I transferred a small DB pension a year or so ago. I used a company called "First Equitable"

https://www.first-equitable.co.uk/final ... er-advice/

I found them a professional outfit to deal with. The whole process was relatively painless.


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