Defined Benefit Pension Transfers for Regulated Introducers

Defined Benefit Pension Transfers for Regulated Introducers

This page is for regulated introducers only and should not be distributed to retail clients.

Conducting Defined Benefit Pension Analysis is a complex and specialist area of financial advice. Regulation is constantly changing and many firms who previously operated in this arena have made strategic business decisions to withdraw from providing advice.

We believe that providing Defined Benefit Pension Analysis continues to be a key part of financial planning. A Defined Benefit Pension often forms a large portion of a client's retirement fund and assets. By not taking the time to analyse what the scheme provides and how it sits with a client's retirement goals, both the client and their Financial Adviser may be left with a 'blind spot' in their financial vision. Whether to retain or transfer a Defined Benefit Pension Scheme is often one of the biggest financial decisions a client will make. Even when retaining, knowing when to take your benefits and in what form can be complex. Specialist advice is crucial.

Our team of Defined Benefit specialist advisers and paraplanners all hold level 6 DB transfer qualifications and a minimum of level 4 investment advice qualifications. Responsibility for oversight of the Harding Financial Defined Benefit process sits with our Pension Transfer Specialist, Julia Cousins, who is also our Head of Risk and Development. One of Julia's former roles was designing and delivering DB training for a large Compliance Services Contracting firm. Julia and our Managing Director Alex Simpson (who is twice Chartered in Financial Planning) head our team of Defined Benefit Pension specialists.

Our Service to you

We aim to provide a service to your clients that compliments your own. We are very selective when it comes to forming agreements with introducers and expect you will be too.

To this end, we:

Believe in a transparent approach, giving you the details you should know about our firm and our systems and controls. The "Harding Due Diligence Document" can be found at the end of this page.
Review the 'Harding Due Diligence Document' periodically (normally annually). The updated document will be posted on this webpage when complete, which will help you adhere to any ongoing due diligence requirements you may have.
Give you access to our Senior Management Function and Compliance/PTS Function so you can discuss how we operate and ask any relevant questions.
Draft a mutually agreed 'Introducer Agreement' so both parties know and agree their responsibilities. An example version of this agreement can be found at the end of this web page.
Conduct our own Due Diligence on your firm, and repeat this on a periodic basis (normally annually).

Our Defined Benefit Service to Your Clients

We have built a straightforward and transparent process to help you and your client understand the value of their Defined Benefit Pension Scheme(s). It is purposely staged, with each stage being priced individually. The benefit of this approach is so that as the client's understanding of Defined Benefit Schemes (and their particular scheme) increases, they can 'self-select' out of the process, avoiding unnecessary further costs.

Our charges are fixed and are not connected to the value of the client's Defined Benefit Pension Scheme. We believe that the amount of analysis and work we complete does not change with a higher or lower transfer value. The amount of work completed is based on the number of schemes being reviewed and the complexity of the situation. On this basis, we feel a 'fixed charging structure' is more appropriate and transparent, and therefore fairer.

We believe that transferring a Defined Benefit Pension Scheme before the client knows what sort of retirement they are planning for is not beneficial and increases the risk of irreversible decisions that may be regretted at a later date. We therefore only provide Defined Benefit Pension Scheme Transfer Analysis for clients who are over the age of 50, or who are in ill health.

Our Defined Benefit Advice Steps

Putting Your Client in an Informed Position

The first step of our process is provided at no cost to your client.

It provides a series of short, engaging educational videos to help your client understand their Defined Benefit Pension Scheme. As an introducer, you can view these videos by clicking 'to start our process at no cost' which you will find below.

Outcome: Your client can choose to retain their scheme and end the process, or they can choose to proceed to the next step.

Helping Your Client Understand the Value of Their DB Pension

This second step is chargeable to your client.

At this stage we will ask your client to complete a Letter of Authority for their DB scheme to allow us to start to collate information from the scheme.

Once received we will send your client a 'Personalised Charges Document'.

We will start collecting some KYC data via our interactive 'Client Portal' and a series of questionnaires assessing their attitude towards 'Pension Transfer Risk' and their 'Willingness to Take Investment Risk', and we will begin to get an understanding of what they are trying to achieve.

Utilising the data received from the scheme we will create a TVAS (no TVC) to calculate any required revaluation. We will also complete any relevant early/late retirement factor calculations and PCLS commutation calculations so your client can begin to see the shape and value their benefits can provide at different ages.

We will conduct an appointment with your client helping them to understand the "value" of their scheme.

Outcome: Your client can choose to retain their scheme and end the process, or proceed to the next step.

Charge: £2,100

What does Retirement Look Like for Your Client

This third step is chargeable to your client.

This step involves gathering in depth understanding of your client's situation, including the details of your client's existing DC schemes and any workplace pension schemes (WPS) they may have.

We will build a detailed cashflow model putting together a projection of what retirement will look like for your client if they retain their DB scheme. This includes any relevant early/late retirement factors, PCLS commutation requirements and any likely LTA charges if relevant. We will also look at what would happen to any dependants (including spouses/partners) if the member were to die early.

This step involves detailed analysis of the client's DB scheme. We will identify how best they can utilise their existing DB scheme to provide the retirement they desire and need.

We will present the outcome to your client via a meeting and provide them with a detailed 'Retirement Report'. This will confirm our opinion on whether they should retain their scheme, or whether it is 'unclear' that they can achieve the retirement they want and need by retaining or transferring part or all of their DB scheme.

Outcome: Your client can choose to retain their scheme and end the process, or if we have deemed the case 'unclear' the client may choose to proceed to the next step.

Charge: £4,200

What Could be the Outcome if Your Client Transferred All or Part of Their DB Scheme

This fourth step is chargeable to your client.

We carry out detailed statistical analysis including the review of any existing DC schemes, including any workplace pension schemes, the client may have.

Utilising the CETV (the transfer value) of your client's scheme and data we have gathered, we will create an APTA (appropriate pension transfer analysis) and TVC (transfer value comparison). We will analyse whether it is beneficial for your client to retain the scheme or to transfer part or all of their DB scheme to a DC pension.

We will also analyse an appropriate investment strategy should partial or full transfer be considered appropriate. We believe ongoing advice is essential for any DB scheme transferred to a DC scheme which is not a workplace pension scheme. On this basis we will include a 'generic' ongoing charge in any analysis we perform for a non workplace pension receiving scheme to ensure the client has a realistic understanding of the cost of a transfer.

We will present our findings to the client and provide a detailed written report giving our recommendation.

Outcome: At this stage our recommendation will be to retain or partly/fully transfer. Your client does not need to follow our advice to transfer however if we have recommended that the client retains their scheme, we will not proceed with a transfer on an 'insistent client' or 'execution only' basis. We will only implement a transfer if we have recommended this is the best course of action for your client.

Charge: £6,500

Implementation of Recommendations

This fifth step of our process is provided at no cost to your client

If we have recommended a transfer and your client wants to proceed, our skilled administration team will implement our recommendations and ensure the DB scheme is transferred to the recommended DC scheme and invested into the recommended investment strategy and the recommended funds.

Charge: £0

Please note that there will be an additional 15% charge on the prices listed above for each additional scheme analysed. Therefore, if we are advising on two schemes, the price for 'Understanding the value of your pension' will be £2,415. If we are advising on three schemes, the price would be £2,730.