LTA instead of DB transfer
parawhat
Member
Working on a DB case. Client 60 now, no intention of retiring until 70 and doesn't want/need income or TFC. Main driver for wanting to consider a transfer is death benefits for wife/son as has other wealth/assets so may never spend all of pension, but then again not wealthy enough to completely write off. Scheme gives 7.5% p.a. late retirement increase post 60. Obviously, that is a very high level precis so doesn't cover all the nitty gritty!
I'm planning on raising with the adviser concerned the alternative of the client taking out a 10 year LTA to age 70 on, say, CETV (or CETV plus growth to 70), as my view is that would leave the client with both options still open in the future i.e. take DB or transfer to DC, whilst still ensuring that if they did pop their clogs early wife/son would still get equivalent lump sum (plus spouse's pension). LTA premium is £65 to £90 pm and client has surplus income to cover whilst working.
Do you think that's a reasonable alternative option to raise/cover off?
I'm planning on raising with the adviser concerned the alternative of the client taking out a 10 year LTA to age 70 on, say, CETV (or CETV plus growth to 70), as my view is that would leave the client with both options still open in the future i.e. take DB or transfer to DC, whilst still ensuring that if they did pop their clogs early wife/son would still get equivalent lump sum (plus spouse's pension). LTA premium is £65 to £90 pm and client has surplus income to cover whilst working.
Do you think that's a reasonable alternative option to raise/cover off?
Jonny (paraflex)
Comments
Paraplanner. F1, Apple, Nutella, ice cream. No trite motivational quotes. Turning a bit northern.
It would give the client the option of continuing the life cover at age 70 regardless of their health and would mean that you would be covered in the event that the client got to age 70 and decided to take the DB scheme but still wanted to keep the life cover.