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UK FINAL SALARY PENSION - Should I Transfer it Now? | Blacktower Financial Management
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Oct 29, 2024
Christina Brady from @blacktowerfinancialmanagem7049 was back in with Moody on Tuesday with an update on the markets, inflation and the banks, but also with some very useful advice for anyone considering transferring a final salary pension out of the UK. For any enquiries contact info@blacktowerfm FAO Christina or get in touch through the website: www.blacktowerfm.com Be sure to Like and Subscribe to our YouTube channel for more insights from BayRadio Spain, and follow us on Social Media: Website: http://www.bayradio.fm/ Facebook: https://www.facebook.com/BayRadioInSpain Instagram: https://www.instagram.com/bayradiospain/
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we specialize in protecting preserving
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and growing your wealth Black Tower
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financial management the team you want
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by your side visit blacktowerfm.com
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Tuesday Morning where we're talking to
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Christina Brady from Black Tower
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financial management so uh stock
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market's up a little bit today oil up uh
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currencies down a touch if we're looking
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at it from this direction but not
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dramatically uh just a drop below the
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160 Mark if we're looking at Euro to
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Sterling now we said we'd talk um
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remember um you know how things go so
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quickly like the years fly by didn't
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seem that long ago where it was like a
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sweet spot a golden period for
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transferring your final salary pension
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things changed a little bit since then
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from what I can go yeah they've changed
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quite dramatically actually when
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interest rates were low
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um final salary pension transfer values
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were at their Peak because but now
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interest rates have risen what it's
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meant is final standard transfer values
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have fallen and they've Fallen quite a
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lot some of them as much as half so if
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you've got a transfer value a couple of
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years ago it was six hundred thousand
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now that may only be three hundred
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thousand but it only affects you if
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you're going to transfer your salary if
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your final salary pension if you're
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keeping it where it is and you're going
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to take the pension everything Remains
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the Same it doesn't matter on the value
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of your poor it doesn't affect how much
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you're going to get each year the reason
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they've Fallen is because of interest
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rates Rising what they do is the
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trustees for the pension company have
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responsibilities to ensure they have
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enough money in the pot to pay out when
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you need to be paid out and so what they
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have to do is they have to set aside and
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provide enough money to get an A return
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that you need for your pension and when
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interest rates were low obviously they
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had to take more risk the heads going to
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the market therefore they had to put a
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lot more money in to get a return now
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interest rates are high they don't need
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to put so much money into risky
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Investments they can put them into you
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know interest rate varying things uh you
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know they can get six percent or more
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um so that means that they have to put
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aside less money to meet your needs so
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basically that has halved so what
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they've what's happened with interest
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rates Rising is they only need to put
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aside half the money
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um so if you were going to transfer your
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final salary pension at the moment
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you've missed the boat you should have
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done it two years ago at least maybe
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before that however if interest rates do
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plateau and start to fall again then
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obviously you the pension companies will
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need to put aside more money so if you
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are thinking of transferring your final
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salary pension and it's not urgent
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please do not do it now you know there
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is no reason to be transferring it at
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the moment you're getting much less than
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you ever would before you need to wait
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until interest rates start to fall that
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could be two three four five years away
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if you can wait that long please do if
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you have got an urgent reason to
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transfer and some people do some people
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you know are ill and they want to leave
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their pension pots to their family
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because if you have a final salary
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pension when you die your spouse usually
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gets half sometimes a little bit more
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your children under 18 are catered For
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but you have no spouse or if your
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children are over 18 you're divorced you
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you know you're a single parent you may
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want to take that part if you know
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you've got a shortened life expectancy
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to leave something to your family so
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there still are exceptional cases to do
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it however for the majority I'd say 90
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no do not transfer your financial salary
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pension in the UK obviously we have the
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lifetime allowance abolished however if
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we do see a labor government get into
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into Power which seems a higher
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probability at the moment they will
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reintroduce that lifetime allowance I'm
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sure and if anything they'll make it
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lower than before so if your pension pot
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is a million or above
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um I would say be on standby that if
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there is a general election coming back
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and it looks like labor are going to
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take a landslide I would most probably
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take a leap of faith and transfer it
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before the results of the election
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um in case they did bring in the
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lifetime allowance which means you're
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taxed once you get home for a certain
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amount but for most people if you are
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preparing to leave yourself if you want
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if you're leaving your final salary
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pension where it is and you are going to
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draw down an income from that from your
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final salary this does not affect you it
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does not affect the amount of money you
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will get each year That Remains the Same
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as I said it's only for people wanting
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to transfer so you know I had my old PA
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from my banking days she sent me a text
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the other day said oh my pension pot has
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fallen by half oh my God I'm really
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panicking I said look I said you're
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never going to take it transfer it
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because you're risk adverse you're going
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to leave it where it is I said your
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actual pension Remains the Same so why
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are you panicking and she came back she
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said yeah I don't know why I'm paying
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and she said it's because some financial
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advisor in England sent me a message
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saying that my transfer value had fallen
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by half and therefore I thought my
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pension would fall by half I said no I
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said please and don't let people panic
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you into saying well it's Fallen by half
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if interest rates carry on Rising it's
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going to fall even more transfer it now
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as I said unless there is really really
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really pressing reasons why you need to
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do it don't uh interest rates are going
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to remain high as I said I think for the
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next I don't know three years maybe a
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little bit more maybe five years
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depending on what happens
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but then hopefully you know we'll have
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inflation under control interest rates
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will be brought back down the target
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rate is two percent
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um obviously they don't like it if it
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goes much lower than that but then that
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would still mean an increase in your
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pension values so that's just a warning
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to people especially if you're being
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cold called people are approaching you
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trying to scare you with your transfer
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value going down please don't be forced
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or scared or you know or bullied into
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doing something where you're going to
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actually lose a lot of money I've just
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heard the the caption from when we put
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this up online to listen back to on
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YouTube please do not do it now in
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capital letters yeah no because people
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it is worrying as I said you know my old
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yeah he found out she was really really
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panicking because some financial advisor
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in the UK had pointed out it was worth
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half the value and she's going oh my God
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what do I do and I was thinking nothing
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you do absolutely nothing you know
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please don't be frightened don't let
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fear take over don't let people you know
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scare you into doing something that
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isn't in your best interest but is in
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their best interest you have to remember
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you know you have to look after yourself
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and it is easy uh you know to take its
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heart and then to worry but if you are
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just check with a good financial
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advisors and most of them I think you
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know any good one will tell you what I'm
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saying don't transfer your final salary
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pension at the moment unless there are
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really really pressing reasons for you
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to do it listening and exceeding
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expectations for over 31 years Black
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Tower financial management a team you
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want by your side visit blacktowerfm.com
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