Savers attempting to cash in their “final salary” pensions are losing out by as much as 55pc on the fair value of their transfer... Telegraph Money has seen cases where the cash being offered is worth less than half of the value of the original final salary pension.
James Baxter of Tideway Investment Partners, a specialist pension transfer firm, said he was frequently seeing similar examples of people being offered far less than expected to give up their pensions.
Mr Baxter suspected a move by companies to insure against the cost of paying final salary pensions was behind the trend. It is increasingly common for firms to pay a large premium to insurers and pass on responsibility for paying pensions... He said: “I think the sponsors of these schemes are hoping some members decide to transfer, generating huge savings. “There is no way for members to challenge transfer offers, and there are huge variations in the offers made for broadly similar benefits. This just doesn’t seem right to me.”...
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Monday 25 February 2019