Introduction to Defined Benefit Transfers

Thank you for visiting this website from Pensions and Annuities Ltd. It’s our brief introduction to Defined Benefit Pensions and Defined Benefit Pension Transfers.

A defined benefit pension is an extremely valuable pension. It is one that is virtually guaranteed to pay out an income and lump sum when you retire. They are often called final salary schemes or DB schemes. 

You’re probably on these pages because you’re considering transferring your defined benefit transfer, and are in the process of seeking advice. 

Please watch the short video below to view our introduction to Defined Benefit Transfers, which includes details of how they work, their advantages, and the risks of transfer.  

Risks of transferring

The general view is that you should not transfer from a DB scheme to one which is based on investments, a DC scheme as they’re often called. This is because they are guaranteed, and there are risks. If you do transfer you:

  • will lose the guaranteed lifetime income from your DB scheme, for you and your dependants
  • will lose the inflationary protections usually offered by your DB scheme, as they usually increase in value
  • will have to pay for the cost of the advice
  • will have to pay ongoing charges to have a DC scheme to investment managers, which is deducted from your fund
  • have to decide how to invest your money , or pay someone to do it for you
  • may see your pension pot fall in value, if the underlying investments fall in value
  • may have less income in retirement, if the fund drops in value
  • may run out of money in your lifetime if the fund fails to grow sufficiently or drops in value


More information

Below are external links to information from three UK organisations which offer more information and guidance on Defined Benefit Pensions. 

The conduct regulator for financial services firms and financial markets in the UK
The Money and Pensions service is an arm’s-length body, sponsored by the Department for Work and Pensions
The Pensions Regulator (TPR) is the public body that protects workplace pensions in the UK

Get in touch with us

If you want to get in touch with Pensions and Annuities Ltd then contact us, or phone on 01793 686393.