We offer specialist, independent advice on Final Salary Pension transfers.
Whether you're looking for guidance on transfer options on your Final Salary Pension / Defined Benefit Pension, or advice on planning your retirement, contact us for a free consultation
Benefits to transferring
There are a number of potential benefits to transferring your Defined Benefit pension, e.g:
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Flexibility on when and how much you draw on your pension
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Ability to pass the pension on
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Although there are also very valuable benefits that may be lost when doing so...
How much is my pension worth?
Transfer values are dependent on a number of factors and often vary between schemes. Typical factors include:
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Your age
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Length of service
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Earnings with the company in that time
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Accrual rate
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expert advice on Final Salary pensions
At Glasgow Wealth, we understand that financial planning can be daunting. That's why our team of highly-qualified advisers provide personalised service and quality advice without any sales agenda. We specialise in final salary pensions for individuals nearing retirement. In addition to pensions, investments, tax and inheritance planning, Get in touch to book a meeting with one of our financial advisers.
"How much is my pension worth?"
Transfer values are dependent on a number of factors and often vary between schemes. Typical factors include:
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Your age (relative to the net age of the scheme)
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Length of service
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Earnings with the company in that time
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Accrual rate and Scheme benefits
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Solvency / funding position of the scheme
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Higher Pension Transfer Values coupled with the introduction of more flexible pension legislation in 2015 had resulted in record numbers of deferred members electing to transfer out of their Final Salary Pension schemes.
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Cash-equivalent transfer values offered by schemes were in many cases, significantly higher due to an environment of very low government bond yields (against which transfer values are calculated). However more recently (in 2023 / 2024), higher bond yields have broadly resulted in transfer values reducing.
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​​Finding out your specific transfer value is the first step in the process, and is something that we can help with.
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You are generally able to request a value from the scheme provider once every 12 months free of charge. As part of the pension rules, once the value has been calculated, you usually have 3 months to complete the transfer.
Benefits and Risks of transferring
Defined Benefit or Final Salary pension schemes are a secure way to plan for robust income in retirement. As such, Defined Benefit scheme members are often best advised to remain within the security of the scheme.
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For those who are looking to assess whether they should transfer their final salary pension, then there are many benefits and risks to be aware of, as detailed below:
​Benefits of a defined benefit pension transfer​
Many of our clients ask the simple question, "Should I transfer or not?" The personal and financial circumstances of each member together with the features of the scheme of which they are a deferred member dictates that there is no simple solution; each decision will come with its own advantages and disadvantages. In the majority of cases, it is expected that it will be in the member’s best interests to remain within the scheme. However here are 3 reasons that we hear commonly from our customers who ultimately do decide to transfer:
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Potentially Better Death Benefits: For many, the cash-equivalent transfer value offered by a Defined Benefit Pension Scheme will potentially be their largest financial asset. Transferring allows you to take personal control of this asset and offers the ability to leave a more significant legacy for the next generation and potentially beyond through potentially better death benefits, especially where a spouse’s pension is of no utility, for example if the member is single, divorced or widowed. Similarly, for members with ill-health or reduced life expectancy, transferring can be the right decision.
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Concern over scheme solvency
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Flexibility at retirement: The ability to access benefits without penalty from the age of 55 gives flexibility and control over the timing and level of benefits versus the usual rigidity of the defined benefit scheme.
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​Risks of a defined benefit pension transfer​
Transferring out of your Final Salary pension scheme is a significant and irreversible decision and is clearly not without risk. As mentioned, for many people the right decision and our advice would be to stay within the scheme for the security that it offers. Here are 5 reasons why this may commonly be the case:
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Loss of Security: Defined benefit pensions are representative of secure income in retirement that is protected against inflation pre- and post-retirement. The loss of this security may not be acceptable to the member considering transfer. Clearly, in this case, the right thing to do is remain within the scheme.
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Investment Risk: Unless transferring to another defined benefit pension scheme, the pension to which you transfer will then be invested according to your instructions or in line with the advice that you receive. No investment is without risk and pension values post-transfer may fall as well as rise. Any investment loss will usually result in a corresponding reduction in the ability to secure long-term pension income. Defined benefit pension transfers are high-risk transactions of themselves simply due to the loss of secure income. Therefore, it is usually the case that those who do transfer are motivated by other factors and not fazed by the investment risk that is subsequently undertaken. In some cases, the investment return required to match the benefits of the scheme can be high and unrealistic.
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Fund can be exhausted during member’s lifetime: Using flexi-access drawdown post-transfer for payment of income in retirement can be a great way to provide income in retirement. However, the investment may well be exhausted during the lifetime of the member and so be unable to deliver any income in later life at a time perhaps when funds will be most relied upon.​
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Loss of Dependent’s Pension: The security of a dependent’s pension for a spouse can be significant, especially if that dependent is significantly younger than the member. Post-transfer, both parties will then be reliant upon the fortunes of the same fund.
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Loss of Pension Protection Fund Security: For most members, the security offered by the PPF in the event that the scheme suffers an insolvency event is usually sufficient to cover the majority of their income entitlement under the scheme pre- and post-retirement, under current legislation. On transfer, this protection would be foregone. More details on the Pension Protection fund can be found here: http://www.pensionprotectionfund.org.uk
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About Us
Glasgow Wealth are an independent financial planning and investment management firm based in Glasgow’s George Square. We work with private clients to meet their long-term personal and financial aspirations.
We specialise in Defined Benefit Pensions, in addition to Pension Advice and Retirement Planning more broadly, as well as Tax Planning, Estate Planning, Investment Management and Wealth Management.
We are based in Glasgow city centre and we serve clients in and around Glasgow, Edinburgh, Lanarkshire, Ayrshire, Perthshire, Renfrewshire, Fife - throughout Scotland and the UK.