Final salary scheme cash equivalent transfer values (CETV) are currently high

A lot of people with final salary pensions, like the oil companies, banks and financial institutions and local council schemes and a host of others can have entirely unexpected pension values when it comes to transferring them.
We have seen plenty of instances where the cash equivalent transfer value (CETV) of a fund is greater than the amount of salary the individual earned while working at the organisation, and is a considerable multiple of the annual benefits promised.  The reason for the high transfer values is the low interest rates in the UK. Essentially, it works the same way as a mortgage – for mortgages when interest rates are low the bank will lend more, well for final salary pensions, when interest rates are low the transfer values are higher. However, low interest rates will not last forever.
See some of the real life examples below:


Case study 1: Striking it rich with a Big Oil company CETV

The member of this scheme had worked for the oil company some thirty years ago, working their for around 12 years.  When they left their final pensionable salary was just shy of £9,000, not bad for back then.  Fast forward to 2013 and after taking into account inflation, really low interest rates in the UK and the fact that the pension scheme is fully funded and this members pension is worth over £200,000 as a CETV – that’s over 20 times what the final salary that the member left on.


Case study 2: Even a few years can be worth a lot (especially in banks)

You don’t have to be speeding toward retirement to find out that your retirement benefits have accrued significantly.  Take this 47 year old member who worked for for a bank for just over 2 years.   The scheme had told her that the annual pension at the date of her leaving employment (which had been 4 years before) was less than £1,400.  Hardly enough to set the world on fire in terms of providing a retirement income into the future.


We helped her apply for a CETV and imagine her shock when the value of that came through at over £22,500.  We helped her with the pension transfer and the rest is history.


Case Study 3: Local councils can be for profit when it comes to pensions

Local councils provide excellent work benefits.  Take for example a council worker with 17 years of service in the UK who pretty much transferred on leaving the United Kingdom.    With a pension benefit of £13,130 on leaving this individual was shocked to find that he had a transfer value of over £235,000 – which we promptly helped him to transfer to New Zealand.

New requirement for UK FCA advice for final salary transfers

The game changed on 6 April 2015 for people looking to transfer UK final salary pension schemes with a value of over £30,000 to a New Zealand QROPS. Now it is a requirement to receive advice from a Financial Conduct Authority (FCA) registered adviser. The FCA is the UK regulator for financial advice and in practice this adds an additional level of compliance to any final salary pension transfer. We are pleased to announce that our clients can receive advice from an FCA registered adviser as a part of our pension transfer service where that advice is required. To understand more about your final salary or defined benefits pension…get our free assessment of your UK pension

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NZ free phone:0800 102 599 / OZ Free Phone:1800 857 410 /

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