For many people, the transfer value of their final salary pension benefits will exceed the value of their house. No wonder therefore that, despite all the barriers to transfer erected by the Financial Conduct Authority, there remains considerable demand for transfer guidance/advice.
New guidance from the FCA which comes into force in Oct will make transfers far more difficult and expensive to facilitate and may well prevent many people from achieving important personal and financial aims and objectives which can only be achieved by way of a final salary pension transfer.
Over the last year, I have guided clients through the transfer process with funds ranging from £200,000 to in excess of £1.million. Others, having gone through the education/guidance process, have decided that the security and guarantees provided by the final salary promise outweigh the flexibility and control offered by a transfer.
I fully support the efforts of the Financial Conduct Authority to prevent unsuitable transfers but in my view, their latest guidance, which comes into effect in Oct, is a step too far. The outcome will be that many more advisers will depart the market at a time when Barnet Waddingham already predict that there will be too few advisers to meet demand. It will become far more difficult to jump through the compliance/regulatory hoops even when a transfer is demonstrably in the client’s interest. Many clients will also be put off by the thought of having to pay huge fees whether or not the transfer goes ahead.
There are many circumstances where a transfer will mean that someone can achieve aims and objectives which would just not be achievable if they remained in the final salary scheme. In many cases, substantial pension benefits/transfer values have been built up over a working lifetime and provided all the advantages/disadvantages have been fully explained and understood there is no reason for putting unreasonable barriers in the way of a transfer.
That will, I think, be the case post-October. If this is or has been, on your radar please explore the possibilities now. I am not a regulated pension specialist and cannot do the required regulatory report but I can source a good adviser for you and provide an up-front education and guidance service which will help you decide whether this is something you wish to pursue before getting involved in an expensive advice process.
TRANSFER VALUES IMPROVED BY 4% IN APRIL (XPS transfer value index). DON’T WASTE ANY MORE TIME. BOOK A 30 MINUTE, NO COST ZOOM MEETING AND LET’S WORK OUT WHETHER THIS IS SOMETHING YOU SHOULD PURSUE.
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