Pension transfers, especially for defined benefit (DB) schemes, are costly due to strict FCA regulations that advisers must follow. On average, an Independent Financial Adviser (IFA) spends 120 to 180 hours managing the entire DB transfer process. This extensive effort includes constant communication and chasing tasks behind the scenes with your UK pension provider.
Since November 30th, 2021, the UK government has tightened rules, removing the automatic right to transfer pensions, particularly impacting expats. Many living abroad are flagged for potential pension scams, which adds extra scrutiny. Additionally, rising professional indemnity insurance costs for IFAs further increase the overall expense of DB pension transfers.
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How Can You Save Your Money on the DB Pension Transfer?
Defined Benefit pension transfers are undeniably complex and time-consuming. While clients often want the lowest possible cost, the reality is that quality defined benefit pension transfer advice requires significant effort from your IFA. That said, there are several ways to reduce your fees without compromising on the quality of advice or outcomes.
Do Your Homework Correctly
Clients who demonstrate a strong understanding of the transfer process and engage with it efficiently can often access reduced fees. Advisers appreciate working with proactive clients who read documentation carefully, respond promptly via DocuSign, and don’t require repeated chasing. This kind of client engagement helps advisers deliver better defined benefit pension transfer advice and can help reduce overall costs.
The smoother and quicker the process, the more time your adviser can allocate to delivering high-value guidance rather than administrative follow-up.
Make A Commitment
Let your IFA know from the outset that you’re committed to the process and value professional advice. This not only helps build trust but can also support the adviser in negotiating internally for potential fee flexibility. Compliance teams may look more favourably on offering incentives to serious, engaged clients seeking defined benefit pension transfer advice.
Build A Trustworthy Relation with Your IFA
Trust takes time, but once established, it can pay dividends. A strong relationship with your adviser can improve communication and speed up the process.
Ask questions early, clarify any uncertainties, and keep an open line of dialogue. A transparent and professional relationship benefits both parties.
Refer Your IFA to Your Colleagues
At Cameron James, we work on an ongoing basis. Our annual fee of one percent is discounted by ten points for each successful referral of friends or colleagues. We now have a handful of clients who are down to 20 or 30 points and have referred six or seven new clients to us. This is highly beneficial to us, therefore in return, we can offer you a discount.
We need to spend a little less on marketing if we receive the client as a referral from you or if you introduce the client to us. So, it's simply taking money out of our marketing budget and putting it back into your wallet in the form of lower rates.
Your Pension Transfer Process is A Time Game
Transferring your DB pension is a time game since your CETV is fixed. For example, if you received your CETV on January 1st from your UK ceding scheme, you only have three months to decide and complete your pension transfer and send in all the paperwork. Your time continues to tick and in that three-month period, the UK ceding scheme can assess it and begin processing your transfer.
If you complete your ‘homework' correctly, the timeline will be shorter than three months. However, if you work with someone who makes mistakes, is unsure of what they're doing, and does not have a dedicated chasing team for these UK ceding schemes, the transfer will take much longer.
The longer you wait to complete your pension transfer, the less likely you are to reap the benefits of your investment. Consider the market's average returns.
If you chose an S&P 500 tracker, the average return over 30 years is 10% per annum. So, if your transfer takes three months longer, and you work with someone who isn't particularly competent at it, you lose two and a half percent in investment growth. If it takes six months longer, you will lose about 5% of your investment growth.
We would not claim that Cameron James offers the most affordable pension process on the market, but we always prioritise your interests. For clients, this guarantees that you are the only entity that hires us; we will always be upfront, and we will avoid any bias or incentives from third parties. From the process perspective, this means that the transfer will take place as quickly and efficiently as possible.
Because you pay our IFA directly, we protect you from any conflict of interest when they invest in products they sell. We prioritise this issue to ensure your best interests always come first in our client service.
Cameron James – Your Trustworthy Pension Transfer Specialist
Cameron James – Expat Financial Planning is the preferred independent financial adviser for International SIPP transfers. With over 10 years’ experience in transferring pensions, Cameron James is now servicing clients in 26 countries.
We have the qualifications and technical knowledge required to help you transfer to an international SIPP both as a UK expat or US resident. Our mission is to bring regulated and transparent advice to our clients. As such, our clients fully understand how much their advice will cost in advance, with no hidden fees.
Cameron James has a sophisticated cash flow management system in place. Our senior management team has a decade of expertise serving expats. They is committed to continuing to serve the requirements of expats for decades to come.