To Transfer or Not to Transfer?

Following coverage in the press about final salary pension transfers and pension flexibility, Tom set about looking at what his pension could do for him and his family and if transferring would be the right thing to do. He had previously held a senior position in corporate banking and was a deferred member of their defined benefit pension scheme.

Tom also wondered if he could pay the rest of his mortgage off and start to wind down in his consultancy business over the next few years approaching 65. He would love to travel more with his wife Helen, who had already retired and they both were keen to start enjoying a slower pace of life and to tick off some bucket list destinations.

Our approach and recommendations

At an initial meeting we introduced Tom and Helen to VWM’s “Thrive” process (https://vwmwealth.com/thrive-wp/ ) which goes further than just finances. Tom and Helen discussed their plans and aspirations for the future and how they would like life to look for them and their family as Tom winds down at work. The use of deep questioning, allowed Tom and Helen to really step back and think about what matters to them and what type of life they want.

Following this, the VWM team carried out a thorough audit of all aspects of Tom & Helen’s finances which included a review of the proposed transfer value for the final salary scheme. In conjunction with the team, Tom & Helen learned how the various options operate, what risks are involved and we collaborated on their priorities and what solution best works for them.

A comprehensive report and cashflow model illustrated the benefits of our recommendation vs the current situation and both Tom & Helen felt that the opportunities and flexibility offered by the pension transfer were perfect for their needs. They also really benefitted from seeing their entire financial plan brought to life on screen.

Following the transfer Tom and Helen are mortgage free and have the peace of mind that their finances are receiving the necessary care and attention. We will meet at least once per year to ensure that their plan stays ‘on track.’

Tom is keen to wind down rather stop work altogether but is happy that he no longer needs to work for financial reasons but continues to do so as he enjoys it and it gives him a purpose. This has resulted in a big mindset shift for him and a lot less worry and stress. Funds have been earmarked to help the children early in life, and the enhanced death benefits on the pension mean that they may also receive a pension legacy in the future. Tom and Helen have significant peace of mind in the ability of their assets to provide the fun filled lifestyle that they seek in retirement and they are very much looking forward to it.