Those of you on final salary pensions did you know the multiplier

[FinallyFluid]

is generally x 20 and some times higher.

That would make us ummmmmmmmmm comfortable, but DH is refusing to even consider,doing a transfer value request.

Personally, I would like to investigate before my risk averse personality kicks back in, before any paperwork was signed.

Just curious, after years of being strapped.

Think carefully about the tax implications before making a decision. Some lump sums are taxed at an eye-watering 55%. A pension is taxed PAYE.

Yes, I am aware that CETV for FS pensions may be high - there was a period recently (pre-Covid!) where they were often high, related to gilts I think.

I am also aware that by doing a transfer:

• I would have to manage a lot of money myself
• I’d probably be paying platform fees and management fees
• I’d be losing a guaranteed, inflation-proofed (ish) income for one with risks
• I’d have absolutely shit my pants when the markets dived in lockdown
• I’d have to pay a hefty sum to an IFA with the additional qualification and insurance to advise on transfers

Unless I had a good reason - such as reduced life expectancy - I wouldn’t even personally get the CETV, as I know I wouldn’t want to transfer. If I had 2 FS pensions and 1 was enough to live on, I might consider it if I wanted access to a large amount of money in one go.

Sounds like it’s his pension anyway, not yours?

@PercyKirke

Think carefully about the tax implications before making a decision. Some lump sums are taxed at an eye-watering 55%. A pension is taxed PAYE.

I think OP is just talking about transferring the pension, not drawing it down. So the tax exposure can still be managed.

Would it make you comfortable, though?

There’s a difference between:
“OMG we’ve got £500K!!!!”
And
“OMG we’ve got £500K to last us for the rest of our lives, and it’s decreasing in value - eroded by inflation - every day, unless we make the right investment decisions in a global pandemic!”

The latter wouldn’t feel comfortable for me 🤣
But - it all depends what the rest of your retirement planning looks like.

Telegraph money pages yesterday (Saturday) had two articles about pensions possibly taking a dive due to tax and final salary ones Not being part of George Osbornes reforms, sorry haven’t got the paper in front of me now to quote pages, but i will be getting OH to read them tomorrow

We are both risk averse, and probably wouldn't but I would love to see the CETV value. we do have another pot which should come at a about £150 k,after tax not a final and some possible inherited wealth if no medical care is required that could net another £150,000

It would look so good on paper, but we are risk averse through and through, but it would be nice to be shown the figures.

That is all, day dream over.

@Cocomarine

Yes, I am aware that CETV for FS pensions may be high - there was a period recently (pre-Covid!) where they were often high, related to gilts I think.

I am also aware that by doing a transfer:

• I would have to manage a lot of money myself
• I’d probably be paying platform fees and management fees
• I’d be losing a guaranteed, inflation-proofed (ish) income for one with risks
• I’d have absolutely shit my pants when the markets dived in lockdown
• I’d have to pay a hefty sum to an IFA with the additional qualification and insurance to advise on transfers

Unless I had a good reason - such as reduced life expectancy - I wouldn’t even personally get the CETV, as I know I wouldn’t want to transfer. If I had 2 FS pensions and 1 was enough to live on, I might consider it if I wanted access to a large amount of money in one go.

Sounds like it’s his pension anyway, not yours?

Cocomarine

It is our pension, we made a decision only to pay one set of fees.

How does that work? A FS pension can’t be contributed to by two people? Unless in a convoluted way, like by doing things like buying extra years (if allowed!) with the money that the other person would have put into their DC pension. I’m curious now! (nosy )

At times he contributed more than we could truly afford, I paid the slack ( my contribution) out of my account by paying household bills, it worked for us. We have been together thirty years and God forbid we divorced, I would visit the pensions and if we don;t and he eventually dies I will have a survivors pension of 2/3, plus the lump sum, plus my state and family money if there is any left.

I have had a glass of wine and I may not be thinking straight, but we have only ever run one pension fund together.

2/3 is good, my husband only gets 1/2!
But even more reason for us risk averse types to not even think about the CETV - 2/3 goes a long way to mitigating the benefit of a DC over DB for not dying with him!