01Why advice is required, and who gives it

If the safeguarded benefits you would give up are worth more than £30,000, you must by law take regulated advice before transferring. The advice must be given or checked by a pension transfer specialist (COBS 19.1), and the firm needs specific FCA permission to advise on pension transfers. Check that on the FCA Register first.

Fewer firms now offer this advice. The FCA's econometric estimate, which it describes as not conclusive, is that its 2020 changes reduced the number of firms providing it by about 195 by the end of September 2022, alongside other pressures on the market.

02What people paid

Type of adviceWhat the FCA found
Abridged advice, outcome: do not transfer£600 to £900 on average; many people received it free
Full advice, outcome: transferAbout £7,100 on average by September 2022 (peak about £7,300, March 2022)
Full advice, outcome: do not transferRose after the ban, peaking at around £4,000 towards the end of 2021

Source: FCA EP25/1 (January 2025). These are averages of firms' average fees, in nominal terms, for a period ending in September 2022. They are historic market figures, not current prices, and some fees were set as a percentage of the transfer value, so they moved with transfer values. Ask each firm for its fee in pounds, in writing, before work starts.

03Abridged advice: the cheaper first step

Some firms offer abridged advice, a shorter form of advice introduced in 2020. It can conclude only that a transfer is not suitable for you, or that you need full advice to know. It cannot advise you to go ahead.

If you then take full advice from the same firm, the FCA expects it to offset the abridged advice charge against the full advice fee, so you are not charged twice for the same work (COBS 19.1A.12G).

04The exceptions to the ban

A firm may still charge only if a transfer goes ahead where the client is in serious ill health, or in serious financial difficulty and needs access to the money (COBS 19.1B.9R). The FCA's rules say people in these situations must pay no more for transfer advice and ongoing services than clients charged in the normal way (PS20/6). See contingent charging for the background.

05Before you pay

  • Get the fee in pounds, and confirm it is the same if the advice is not to transfer.
  • Ask what any ongoing advice and product charges would cost each year if you did transfer.
  • Be wary of unsolicited contact about your pension, promises of high returns or pressure to act quickly. See how to spot an investment scam.

06Common questions

Do I pay if I am advised not to transfer?
Usually, yes. The FCA says that in most cases you pay the same for full advice whether or not you go ahead with a transfer, apart from the narrow exceptions for serious ill health or serious financial difficulty.
Is advice compulsory for a small final salary pension?
The legal requirement applies when the safeguarded benefits are worth more than £30,000. Below that, you are not required to take advice, though the decision is just as hard to reverse.
Will I pay ongoing fees after a transfer?
Usually there are ongoing costs: product and fund charges on the new pension, plus any ongoing advice fee. Ask for the total in pounds a year before deciding.

Sources and further reading

  1. FCA — EP25/1, evaluation of the 2020 ban on contingent charging (30 January 2025)
  2. FCA — defined benefit pension transfer advice: what to expect (updated 13 May 2024)
  3. FCA — PS20/6, pension transfer advice: final rules (June 2020)
  4. FCA Handbook — COBS 19.1 to 19.1B, pension transfer advice and charging

About this guide: figures are labelled with their source and date and describe the market, not any firm; illustrations are arithmetic, not forecasts or quotes. This is general education, not regulated advice or a personal recommendation, and FinancialAdvisor.co.uk is not authorised or regulated by the Financial Conduct Authority. Spotted an error? Report it and we will correct it.