How to find a reputable pension transfer advice specialist

With swathes of financial advisers exiting the pension transfer advice market, it’s becoming increasingly difficult for clients to find specialist advice on Defined Benefit (DB) pension transfers.

According to a report in The Financial Times, the number of professionals offering advice on transferring from a DB pension to a Defined Contribution (DC) pension has shrunk from 3,000 three years ago to around 1,000 today.

This has been blamed on increases in the cost of Professional Indemnity cover and a ban on ‘contingent charging’. Prior to 1 October 2020, advisers could only charge a client if the transfer of a pension went ahead. Now, clients must pay for advice regardless of whether the recommendation is to transfer their pension or remain in their scheme.

Although the pension transfer advice market has shrunk, it’s crucial that clients don’t just settle for the first adviser they find. Transferring a DB pension is a potentially life-changing decision and, according to the Pensions Regulator and the Financial Conduct Authority (FCA), it will typically be in the client’s best interests to keep their DB pension.

It’s vital to find a financial adviser who specialises in Final Salary pension transfers and who has built up a reputation for providing high-quality advice.

Don’t just rely on the FCA Register

The FCA Register is a useful source for checking that a financial advice firm is authorised by the FCA and for finding out which activities they have permissions for.

However, the FCA Register doesn’t show whether the selected financial adviser is qualified to give advice in the specific area of DB pension transfers. In addition, the FCA Register doesn’t give any indication as to the level of service provided by the adviser.

This means further investigation is required. Other sources to consider using include:

• Word of mouth
• Positive or negative reviews online
• Client feedback.

If you can speak with other advisers or clients who have used the services of the pension transfer specialist, then all the better. This could give you a real insight into their level of expertise and the depth of service provided.

Find an adviser who specialises in DB pension transfers

Finding an adviser who specialises in DB pension transfers is important because they will have a thorough understanding of the advice process. They will also understand the changing regulatory requirements and be able to quickly respond to changes. In other words, they’ll take a proactive rather than a reactive approach.

A reputable pension transfer specialist will hold the Pension Transfer Gold Standard, which means they adhere to strict standards when helping clients understand and obtain appropriate financial advice. They may also be recognised by their peers or governing bodies for the work they have carried out as a financial adviser.

It’s also important that the pension transfer specialist instils trust and confidence in the client and doesn’t make them feel rushed. The adviser should ensure the client fully understands the risks of giving up a guaranteed income, including their pension pot falling in value and the possible need to change their lifestyle in retirement.

Make sure the adviser provides face-to-face meetings

It’s really important to ensure the financial adviser provides face-to-face meetings with their clients, rather than providing advice remotely.

Transferring a DB pension is one of the biggest financial decisions a client will make. Their pension could be their largest investment, including their own property.

Face-to-face advice is vital for the adviser to get to know the client properly and to make a fully informed decision regarding the transfer. During the meeting, the adviser should find out the following information about the client:

• Current financial circumstances and aims
• Priorities and spending plans in retirement
• Other pensions, assets and debts
• Health and their family’s health, if relevant.

The adviser should check the client has fully understood the advice they’ve been given. It is easier to form an accurate picture of the client’s level of understanding in a face-to-face meeting than it is remotely.

Get in touch

At Palantir Financial Planning, we specialise in providing advice on DB pension transfers. In fact, 90% of our work is around Final Salary pension advice.

We strongly believe that face-to-face advice is the best way to get to know our clients. The coronavirus pandemic has put a temporary pause on face-to-face meetings, but we’ll provide them again as soon as we can.

Each client who comes to us benefits from unlimited meetings so that we can form a complete picture of their financial needs and goals. As members of the Pension Transfer Gold Standard, we go beyond the minimum requirements when giving financial advice.

Eamonn Prendergast, our director and Pension Transfer Specialist, has the latest pension advice qualification from the Chartered Insurance Institute (CII AF7) as well as the qualification in retirement income planning (CII AF8).

Eamonn has also been shortlisted as a finalist for two prestigious financial awards: Adviser of the Year at the 2020 Professional Adviser Awards and Retirement and Later Life Specialist of the Year at the 2020 Personal Finance Society Awards.

We work closely with other financial advisers to help them and their clients receive the best possible advice. But don’t just take our word for it – read reviews from advisers and clients who have worked with us in the past.

If we can assist you or you have clients who you think could benefit from a discussion with us, please get in touch. Email info@palantirfp.co.uk or call 020 8464 9012.