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You’ve put in a lifetime’s worth of work to get your pension. Every stage of your life, from setting it up to saving and eventually drawing an income, comes with a number of factors to take into account. Most people only have one chance to plan for retirement, and it’s neither straightforward nor simple. And for this reason, finding the right IFA can be crucial. We’ll now examine why using an IFA is crucial when moving your DB Pension or other UK pensions.

We’ll answer the importance of an IFA and whether you can transfer your pension yourself in this post, or you can watch a short explanation by our CEO and Independent Financial Advisor, Dominic James Murray, in this video below.

What Is an Independent Financial Adviser (IFA)?

An independent financial adviser (IFA) can be either a financial advisory firm or an individual. While independent advisers’ services are typically similar to those of any other adviser, they are not affiliated with any larger financial institutions. As a result, they are not constrained by special interests and can recommend a wide range of financial products.

How To Tell if an Adviser Is Independent

Asking your financial adviser or their firm if they are independent is the best way to find out. However, it is not difficult to determine on your own. Because independent firms and advisers are not affiliated with larger institutions, large, well-known advisers are unlikely to be independent. Even registered representatives of larger firms are not truly independent.

When looking for an adviser to work with, be wary of those who only offer a limited number of investment products. Non-independent advisers frequently offer options linked to their parent company, such as investment funds and insurance policies. While this isn’t always a bad thing, an independent adviser may have a more comprehensive set of services.

It’s also worth noting that independent advisers can be either individuals or businesses. Independent advisory firms, like parent companies, are not beholden to any special interests. Independent advisers can work for themselves or for firms of independent advisers.

Do I Need an IFA To Transfer My DB Pension?

There are at least two ways to transfer a pension, so it’s important to understand which one you mean first. Transferring a pension can be investing in a DB Pension plan or transferring a DC Pension from one plan to another (or combining several into one).

Now let’s talk about trading in a Defined Benefit Pension plan!

When a Defined Benefit (Final Salary) workplace pension is exchanged for a pension pot of roughly equivalent value,  advice is almost always required.

If the transfer value of the pension you want to transfer is £30,000 or more, the law requires you to seek financial advice first. However, your IFA will charge you for comprehensive advice and won’t just sign a letter authorising the transfer. This is because, by advising you to transfer, the IFA assumes responsibility and risk in the event that your choice is unwise. For that reason, this could be quite expensive to them.

For instance, a significant portion of your pension pot might be lost if the stock market crashes soon after your transfer. Alternatively, you might unintentionally draw out too much and quickly empty the pot. As a regulated adviser, the IFA is accountable for the advice they give, so they won’t just approve your choice. Keep in mind that you will ultimately be protected by this legality which is a good thing.

Do I Need an IFA for Other UK Pensions Other Than DB?

As already mentioned, investing in a DB Pension plan is just one type of pension transfer; another is moving a DC Pension from one plan to another or combining several into one. So let’s discuss transferring or consolidating a Defined Contribution Pension pot.

When changing jobs and getting a new workplace pension, or when combining several pensions into one, you can transfer a pension pot from one plan to another (pension consolidation). These days, you have a lot of options and flexibility when it comes to accessing your pension, but this freedom comes with an increased level of responsibility and risk.

An IFA can assist you in making the most of your investments and securing them. They can also keep you up to date on evolving and changing pension rules due to their expert knowledge of legislation and regulations.

When you talk to your financial adviser, make sure you ask them these important questions:

  • Will managing the new pension cost me more or less than managing my current one?
  • Are the new investments going to fit with my risk tolerance?
  • Do you charge transfer fees?
  • Will I lose any promised benefits?
  • Do I need to combine all of my assets into one account?
  • Is there a chance I’ll need advice in the future?

Talk to Cameron James for the Best Financial Advice

You might wonder if you should ask a financial adviser for pension advice if you’re getting close to retirement age or considering taking a pension withdrawal or cashing it in.

No, a financial adviser is not required for you to access your pension. However, there are some situations in which you should seek advice from a financial adviser, such as when leaving a pension plan.

An IFA will use their knowledge to help you use your money wisely. They will take the time to understand your unique requirements and weigh up your options because they are legally obligated to offer advice that is advantageous to you and your situation.

Now, don’t hesitate to schedule an appointment or contact us here if you have any questions about this topic or if you want to speak with one of our advisors at Cameron James. You can also learn a lot of information about UK pension plans by visiting our website and blogs.


Dominic James Murray

My career in financial services began in 2010 during my Bachelor of Science (BSc) Undergraduate degree at Aston University in England. The degree required me to spend a year abroad working with an established organisation.

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