Comment on recent FTAdvisor article on pension freedom

FT Advisor last week published an editorial about how Pension Freedom was “not working”.  In the comment section I ventured that Independent Financial Advisors might be leaving themselves vulnerable if they have a policy of always declining transfers from Defined Benefit (final salary) schemes into Defined Contribution arrangements, such as a SIPP.

Most people would be best advised to stick with their final salary pensions.  However, if leaving an inheritance is important to you, and, crucially, you have sufficient other resources from which to draw an income, a transfer could make sense.  This is because a defined contribution pension, in many circumstances, can be left to descendants free of inheritance tax and now, thanks to Pension Freedom, without paying the 55% Death Tax.

By systematically denying pension savers this opportunity, IFAs will almost certainly be giving their clients advice they know to not be in their client’s best interest.  See the article and my comments (stuarttrow) at  http://www.ftadviser.com/2015/08/12/opinion/jeff-prestridge/pension-freedom-is-not-working-yO5nD7v50HKTbGIFGVtXXO/article.html

 

 

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