Our Barnet IFA's review - Should you cash in your final salary pension scheme?
Monday 22 August, 2016
Our Barnet Independent Financial Advisers review - should you cash in your final salary pension scheme?
Anyone retiring on a defined benefit pension scheme (otherwise known as a final salary pension scheme) will receive a guaranteed income for life which will typically increase with inflation. Given recent changes to pension flexibility, more and more people have been tempted to consider transferring their benefits out of a final salary scheme as a lump sum into a money purchase scheme.
Since Brexit, pension deficits have increased further as bond yields have fallen. This means that a company pension scheme requires more money to produce the promised level of income, and has led to some company pension schemes quoting larger than ever transfer values to members.
Simon Prestcote, chartered wealth manager and independent financial adviser in our Barnet financial planning team said:
‘Since Brexit many transfer values have been increased substantially. Historically most people have been better off not giving up their final salary pension scheme as their income is guaranteed and inflation proofed. However, in certain circumstances, this could now be worth a fresh review.
At Lonsdale Services our independent financial advisers always consider an individual’s pension decision within the context of their overall financial planning situation. Given the new pension freedoms we recommend that anyone coming up to retirement with either defined contribution or defined benefit pension schemes seeks independent financial advice so they make the right choices for their retirement.’
Lonsdale Services regularly host free pension seminars that review all available pension options. We also recommend you read our Retirement Guide which provides information on all your choices at retirement. To determine what you should do about pensions at different stages of your life read, Your Retirement Options- freedom & choice: before, at and in retirement.
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