Pension Transfer Advice
Defined benefit pensions
Background
In 2015, the government’s pension freedoms gave consumers with defined contribution (DC) pensions more flexibility in how and when they could access their savings. The government put in place a mandatory advice requirement to prevent members of defined benefit (DB) schemes from transferring against their own best interests. DB pensions are extremely valuable as they offer guaranteed, inflation-proofed lifetime income for members and their spouses which most consumers want in retirement. They also protect members from the longevity and investment risks to which members of DC schemes are exposed. However, significant numbers of DB scheme members have transferred to DC schemes.
Our Chartered financial planners are fully qualified pension transfer specialists, however, due to commercial reasons, we have decided to outsource this advice. This gold standard service is offered through Aviva, which is one of the strongest financial services brands in the UK.
Important notes on defined benefit transfer advice:
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This is a restricted advice service which means that we can only offer advice on Aviva products and services.
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Aviva has an investment proposition focused on strong analysis of customer needs, development of an attitude to risk and use of the competitive fund ranges. In taking responsibility for the full end to end DB advice process, Aviva maintains the responsibility, deciding the final investment decisions to ensure good customer outcomes in the short, medium and long term.
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We do not accommodate insistent clients.
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We do not accommodate cases where the client is under 53 years old.
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We do not accommodate cases where the total CETV is under £100,000.
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The CETV must have at least eight weeks’ validity remaining.
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The advice and recommended investment strategy must remain in place to ensure suitability unless there is a material change in personal or financial circumstances.
There are three stages to the advice process:
Triage
Triage is offered through a series of short videos outlining the following:
- The pros and cons of each type of scheme
- A summary of the sorts of consumers who might typically benefit or not benefit from a transfer but without personalised references to the consumer’s own circumstances
- An explanation that the FCA believes most consumers are best advised to stay in a DB scheme.
Triage is provided free of charge.
Abridged advice
This is a standard part of your DB advice journey. Following a review of your personal and financial circumstances, abridged advice helps avoid the cost of full advice, if it’s clear at an early stage that remaining in a DB scheme is the right recommendation.
The charge for the abridged advice service is £800 (plus £160 VAT) and includes the collection of data, analysis and generation of the abridged advice report. In the event that the outcome is to remain in a DB scheme, you will be charged the full amount. There is no additional charge for multiple schemes.
Full advice
The full advice charge is made up of two elements: There is a flat report fee of £1,525 and in addition, there is an advice fee of up to 2% of the transfer value.
Full advice service (ex VAT)
| Value of CETV advised on | Report Fee + | Advice Fee |
| First £100,000 | £1,525 | 2.00% |
| Next £200,000 | 1.75% | |
| Next £200,000 | 1.25% | |
| Next £500,000 | 0.25% | |
| Amount above £1M | 0.00% | |
The maximum Fee is £10,775 (plus VAT)
If a client receives an unclear recommendation at abridged advice stage and proceeds to full advice, the £800 (plus VAT) advice fee for abridged advice will be replaced by the full advice fee.
Client stories
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Clive & Karen Seeley
We are delighted with the service provided by Andrew and his team. They listened to what our goals were and worked with us to provide a solution to achieve them. Andrew’s support and advice has ensured that we can now relax, enjoy our retirement and achieve those goals.
Read moreJeremy & Jayne Cooke
The model Andrew has provided allows us to have a choice with Jeremy’s pension. It provides funds in later life, but also allows us to have sufficient income while we are still young and fit enough to be able to do the things we want before Jeremy’s health deteriorates further.
Read moreJacqui Collins
Andrew completely changed the way I thought about planning for retirement. Without Andrew’s help and advice, I would probably have had to continue to work well beyond age 60. A year into retirement, my finances have worked out exactly as planned. I will always be grateful.
Read morePaul & Ruth Jeffries
After working hard for many years, we wanted a retirement that we could enjoy, not just ‘scrape through’. We needed to know there was still a future there to enjoy, and the plan that Andrew created for us has given us the financial security to retire with confidence.
Read moreGraham and Sherill Worgan
On meeting Andrew for the first time we were extremely impressed by the considerable time he spent in determining and fully understanding our retirement needs and aspirations. This has contributed considerably to the enjoyable and secure retirement we have enjoyed since 2013.
Read moreBob and Judith Choppen
Andrew’s approach was different in that he spent a great deal of time with us understanding what we wanted to achieve from our total assets during retirement. We remain very happy and value his friendly nature and interest in our current needs.
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