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  • This topic has 3 replies, 4 voices, and was last updated 1 month ago by mel.
  • DB Pension or Transfer, any thoughts

    Hello All

    Just wondering if anyone has any thoughts from their own experience on my position

    I have a DB pension which completes in around 6 months paying around £26K/year + £78K lump sum

    Or I could consider CETV of £890K


    I have no children, my partner is 5 years older than me, health is OK, no mortgage

    I am taking financial advice, but always interested in others opinions

    Given curent CV19 I am inclined to stick with DB scheme

    Posted by oniztiptoes
    • Reply by mel

      Hi, hope you’ve seen our article on this subject? https://restless.co.uk/money/retirement-planning/should-i-transfer-my-final-salary-pension/

      There’s lots of information in there on the pros and cons, but it’s definitely vital to get professional financial advice.

    • Reply by Brian Johnson

      Your pension decision should be taken looking at both your financial positions, so all your assets and looking at your future plans and future adverse life time events.

      Choosing to transfer to a more flexible arrangement or take cash depends on your plans and your attitude to risk.

      If you choose to take cash think about what are your plans for it and whether a higher guaranteed income would be better in the long run.

      Sitting down and planning out your financial needs for the next 30 years will help you make a good decision now.



    • Reply by Paul07

      Hi, As you are taking advice you will no doubt be aware that this is a huge decision and one that could have serious financial implications if it goes wrong. My advice to people in this situation is always to start with the question of will the projected DB pension be sufficient for your needs and will it support your lifestyle in retirement? If the answer is ‘yes’ then there would have to be compelling reasons to consider the alternative.

      Also, are you reaching your pension scheme’s ‘normal retirement age’ or are you taking benefits early? If the latter then early payment penalties may apply.

      There can be valid reasons to consider a transfer and use the pension withdrawal flexibility and they include flexibility of income withdrawal (whereby you can increase.decrease, stop and start, etc.), income tax planning,  the possibility of a much larger tax-free lump sum (in your case this is true i.e. 25% of £890k = £222k) and superior death benefits whereby the funds can be left to whoever you choose and would be tax-free if you die before age 75. All of this could be subject to change of course in the Autumn Budget.

      You may wish to ascertain what the current DB pension provision is for your partner and whether they are financially dependant upon you and so would qualify for the spouse/dependants pension.

      I hope that this is of help to you.