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  • Michael Roberts

Should you transfer out of your Final Salary pension?

Whilst the majority of final salary pension schemes are, sadly, now closed to new members, and many are also closed to future accrual by existing members, there are a great many individuals who hold some form of benefits within a Final Salary pension (also known as a Defined Benefit pension).

With gilt yields at historic low levels, transfer values from Final Salary pensions have increased dramatically, because of the way the trustees are required to calculate the transfer value.

As a result, many such individuals with deferred Final Salary benefits are now questioning whether they should transfer their pension to a Personal Pension or other similar arrangement, to enable them to take advantage of the new pension freedoms that came into effect in April 2015 (which don’t apply to Final Salary pensions).

Royal London have published a helpful guide which looks at some of the main considerations, which is available here:


Whether to transfer or remain in a Final Salary pension is a very important decision to make, particularly because once you have transferred, there’s no going back.

The attached guide has been published by Royal London, which I think is essential reading for anyone considering whether they should transfer out of their Final Salary scheme.

Important Note

This article is intended for information purposes only and should not be considered to be a recommendation. This article is based on our understanding of current and draft pension and tax rules as at the date of this article. Please note that tax and pension rules are subject to change; if you are at all uncertain about the suitability of any option for your circumstances we strongly suggest you seek regulated personal financial advice. You should not take action solely on the basis of this article without seeking advice specific to your circumstances. Please get in touch to find out more.

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