Defined Contribution Pension Transfer

Defined Contribution Pension Transfers or Consolidation

Since the pension freedoms were introduced in 2015, Pensions have become one of the most tax-efficient and flexible ways of saving, and with more and more emphasis being placed on the individual to save for retirement, we see pension planning as a fundamental way of helping individuals plan for their future and we take enormous pride in being part of this process.

Many new clients come to us having a dispersed range of paid-up pension plans from previous periods of employment and it is often the case that people feel that they have no control as there is a lack of understanding regarding what has already been accrued and what the options are.  Often the existing schemes need to stay where they are, perhaps they have low (subsidised charges) a good range of funds or even in some cases guaranteed high levels of annuity on retirement, however often the reverse is true and some existing schemes can have noncompetitive charges, be invested within old fashioned poorly performing funds and may not be set up to offer the full range of flexible retirement options now on offer.

We find that helping clients to understand what they currently have and what their options are, provides a great amount of comfort in this core area of planning for retirement and what was once viewed as a minefield (quite commonly a stack of papers that a particular individual didn’t really want to look at), becomes a planning process which suddenly feels financially material to a client’s life, under control and something which they feel committed to.  Helping to bring this together for clients in a manner that can be easily understood, is the key reason we at Accudo enjoy being financial advisers as opposed to the interpretation of pension regulations and tax legislation per se (although we do know and need to know the latter to achieve this!).  


Some of our existing clients have plans to do the following (or are already doing so!) travel the world, build a workshop in the back garden, take up long-distance walking, move to Spain, work as a non-executive director or immerse themselves in the local community or enjoy the home that is now mortgage free.

Whatever your dream is, understanding what you already have in terms of pensions and putting a plan in place to get the fund value you require is the first step we can help you with.

In order to be able to provide you, the client with impartial advice and ensure that we do not need to sell you anything in order to earn a fee, we have come up with a 3-part pension planning report for which we charge £950 flat rate fee.  As the name suggests there are 3 parts to the report; namely analysis of the existing schemes, a comparison of the existing schemes to other potential schemes and an analysis of the retirement options within the existing schemes compared to alternatives.   Below, we run through the full range of areas looked into within each part of this report and at the bottom of this page we describe in more detail how the fee for this report and potential further fees work.

1. Existing Schemes

Full research into existing schemes, facilitated by sending a letter of authority and pension information request letter to these schemes, to include:

  • Analysis of charges on existing schemes
  • Analysis of investments held within the existing schemes and analysis of the past performance of these funds
  • Analysis of the choice of alternative investments within the existing schemes
  • Retirement choices within the existing schemes i.e. availability of income drawdown, guaranteed annuities etc.
  • Illustrations of existing schemes to planned retirement date

2. Comparison of existing schemes compared to consolidation of the existing schemes into an alternative plan during pension accumulation stage (i.e. growth and contribution phase of a pension, prior to taking an income)

Consideration of whether consolidating the existing schemes into 1 new scheme might better meet the client’s needs, to include:

  • Indicative illustration of the fund value at retirement date, assuming consolidation of existing schemes into a new scheme
  • Outline of the investment options within a new scheme (without preparation of a full bespoke portfolio as this would be undertaken if you proceed)
  • Recommended monthly investment amount between now and the client’s anticipated retirement date with a new scheme (including the gross and net cost of these contributions).

3. Retirement Options during pension withdrawal stage

Discussion of the retirement options, including the methods of actually drawing an income from your pension plans (known as pension decumulation), include:

  • Explanation of Income Drawdown (now known as Flexible Access Drawdown or FAD) and Annuity Route including the generic pros and cons of each route.
  • Outline the pros and cons of annuity purchase and income drawdown regarding the client's situation.
  • Recommendation for each scheme considered in view of the client’s specific situation to include (but not limited to) availability of other assets held, income from other sources, objectives (i.e. death benefits versus the desire for secure and guaranteed income), spouse income requirements, the tax rate paid and attitude to investment risk.

Total Initial Cost £950

Potential Further Costs Post Report

  • If you proceed with any of the recommendations, potential further costs will apply (typically a 1-2% initial charge and 0.5%- 0.75% annual charge (depending on the total size of all pensions) for a new pension or flexi access drawdown arrangement/new pension arrangement or 1-2% commission for an annuity.  The drawdown/new pension charge is typically taken from your fund, whereas the annuity commission is not.  To ensure that you are not doubly charged by Accudo, if you proceed with the drawdown route, new pension or annuity route, this £950 charge would be deducted from the further 2% charge.


  • For example, client A has 3 pensions worth £80,000 and £120,000, as a result of the recommendations within the report he decides to go ahead with a new drawdown arrangement of £200,000 which would be charged at a 2% initial fee i.e. £4,000, however £950 has already been paid for the initial research report, thus the charge for effecting the drawdown/new pension would be £3,050. The annual charge for managing the investments within the new arrangement would be £1,500. (Please be aware that this would increase if your portfolio increases).


  • Alternatively, client B has 2 pensions of £40,000 and £10,000 each, as a result of the recommendations within the report he decides to go ahead with an annuity, for which we would typically be paid 1.5% commission by the annuity provider i.e. £750. We would refund this £750 to the client.

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