Articles - DB Transfers from the members perspective

 By Kevin Hollister Actuary and Founder of Guiide DB

 
 So what is it generally like from the member’s point of view when they ask for a transfer value?

 I am also told that in order to access this transfer value I must take advice. It’s the law and there is no way around it. Not only do I need advice, but I need advice from a specialist type of adviser with transfer permissions.

 I don’t know it yet, but the number of specialist advisers in the market has rapidly reduced due to a variety of reasons and it’s getting hard to find someone suitable.

 My transfer pack contains a link to unbiased.co.uk where I can try and find an adviser myself and also a link to the MoneyHelper service, where I can receive some guidance. Finally it contains a letter educating me around scams.

 So in summary I am left with a life changing amount of money in my hand, to try and find specialist advice from an ever shrinking market myself with no further support.

 This is the reality for around 80% of schemes who do not appoint an adviser or panel of advisers directly to help their members.

 The process described above for the 80% of schemes not appointing their own advisers just leads to the continuation of this problem.

 The risk of a member having to find their own specialist advice, falling victim to a scam or receiving poor, expensive or biased advice has been clear for some time. Yet the pace at which this is being addressed continues to be slow.

 Recently trustees have also been given the legal power to block transfers they believe are a scam. Therefore, there would now appear a greater risk to trustees if a scam transfer is made and the trustee did not use the powers they now have available to block this. Given this, it is likely most trustees will undertake scam checks (at a cost) before allowing transfers.

 Transfers can proceed with no further checks to authorised master trusts, authorised collective defined contribution schemes, and public service schemes. They can also maintain a 'clean list' of personal pension schemes they have reason to believe are not being used for scams.

 However, this seems to be tackling the problem the wrong way round. If members are signposted to suitable advisers in the first place, then any transfers following this advice will be to a suitable receiving vehicle and the receiving vehicles, including personal pension schemes used by the adviser, can be checked and approved at outset and added to their cleanlist.

 This is why we created Guiide DB, a free to use alternative that we hope can become the default signpost for those schemes that do not appoint their own adviser.