Savers 10 years away from retirement could lose nearly half of the value of their defined benefit pension (Final Salary) if they choose to transfer, according to new research.
The analysis from Royal London and consultancy Lane Clark & Peacock finds for those people the transfer value on offer will on average only be around 55 per cent of the “full value” of the pension given up.
It shows that for members within one year of retirement, the transfer value is, on average, 75 per cent of the “full value” of the pension given up.
Despite these statistics, the research also shows that advisers are expecting the impact of the FCA’s new rules on pension transfers to have little impact on people’s decision making.
If you are considering such a transfer, please be very wary. It may not be in your best interests.