Meeting FCA regulations

Pension transfers and FCA regulations

Some decisions you make regarding pensions can’t be undone so true expert advice and guidance is essential.

With the consequences being so critical to long term wealth, some financial advisers steer clear of pension transfers; however, others with limited experience may attempt to advise in this area.

Don’t forget the saying ‘a little knowledge can be a dangerous thing. That’s why the Financial Conduct Authority (FCA) heavily regulates this area of advice.


Tools used by typical financial advisers

Our process is fully compliant with FCA regulations arms our clients with all the information they need to make a sound decision.

Before a financial adviser can transfer a pension they have to demonstrate this action is in their client’s interest. To do this they will use a Pension Transfer Analysis and create a report.

More often than not the result will be ‘No’. However, for high wage earners the Pension Transfer Analysis report does not always take into account other factors such as the impact on the fund if the pension scheme was closed.

Our Pensions expert Nicola Downs has created an analysis process that sits alongside a Pension Transfer Analysis report and brings into consideration a wide range of other factors. This analysis arms our clients with all the information they need to make a sound decision. Naturally, this process is also fully compliant with FCA regulations and fully documented every step of the way.


Transfers at Trustees Discretion

The trustees of your pension scheme are under no obligation to allow you to transfer out and they can make their own calculations regarding what your pension fund is worth.

Fortunately, we know how trustees work and will negotiate with them on your behalf. Because we ‘speak their language’ the process can be speeded-up significantly.


General Rules

While every scheme is different, there are some general rules:

  • You cannot normally transfer out of your final salary scheme pension if you are within 12 months of the scheme retirement age.
  • You cannot transfer out once the scheme has entered an assessment period with the Pension Protection Fund. This happens if the company goes into administration or it’s clear they will not be able to meet their liabilities.