IN all the years that I have been advising people on transferring pensions, I have never seen such astronomical transfer values, especially in the finance, manufacturing and retail industries.
In the past, Final Salary pensions were seen as the ‘gold plated’ pension option, however, over recent years, opinions have changed dramatically. Many UK schemes have unprecedented levels of debt and transfer offers are at all-time highs. Transferring away from your final salary pension has never been so popular, with 10,000´s of applications each year.
It was due to a similar article over a year ago that my client contacted me. He had worked as a store supervisor in a leading supermarket chain, and had no idea what his pension options were. He was 52 years of age and wanted to start thinking about when he could retire and what his annual pension would be.
After initially meeting with him, I sent off for a transfer value, and a few weeks later I was sat back in front of him .In short, he could expect an annual pension of £10,200 at the age of 60, or, he could leave the scheme with a pot of £350,000, or approximately 35 times his annual pension.
There are lots of factors that need to be considered before deciding if a transfer is right for you, however, for this client, the high transfer value, along with being able to retire 5 years early, were significant. I was happy to recommend that we move his £350,000 transfer offer into a UK based private pension, and have his pension funds managed by a well-known, FTSE 100 company.
He would not only have full, flexible access to this pot from 55, but should anything happen to him, his entire pot of £350k would be left to his loved ones, something that his final salary scheme did not offer.
This isn’t an isolated case, I’ve seen pension values, especially from banks, retail and manufacturing companies,as high as 40 times the annual pension.I will re-iterate that it is not always beneficial to transfer your final salary pension, they are very valuable and offer benefits that cannot always be replaced. What I will say,is that requesting a valuation is simple, free and can be life changing.
If you would like to know what your pension transfer value is email me [email protected] or call 693 107 044.