Remember that old BT advertising slogan: ‘It’s good to talk’?

In January, former Pensions Minister Ros Altmann followed its advice by announcing that she had cashed in two of her DB pensions, due to the cash sums offered increasing from £108,000 to £232,000 for one, and from £54,000 to £104,000 for the other, since 2014.

Of course, Altmann is entitled to do whatever she feels is best for her own financial arrangements. And I would even say that by being open and upfront about her own money matters, it may help to encourage others to think about and discuss their personal financial situations. Making pensions a more ‘socially acceptable’ topic of conversation can potentially help to demystify the complex subject.

But I fear the nature of this announcement in particular may do the opposite.

I’m sure that there are many people who, presumably like Altmann, are in the fortunate position where they have sufficient provision at retirement, to the extent that they can cash in a DB pension or two and still be confident of a steady, secure, financial income at a later age.

To whom the above applies, great. Transfer values are currently at record highs, so now is an excellent time to cash in and enjoy that windfall. And who wouldn’t be tempted to do exactly that once they read about the significant amounts they could have, right now, by transferring their final salary pension?

The trouble is, this could understandably be tempting for anyone with a DB pension. Altmann’s cashing in of two DB pensions made the national news, with The Times leading its article with: “Weigh up well that bird in your hand. Even the former Pensions Minister has cashed in her gold-plated pot. Should you follow suit?” The Telegraph reported similarly, beginning with: “If a former Pensions Minister cashes in her final salary plans, perhaps you should too.”

Both articles go on to counsel caution in doing so, but sadly, will everyone read beyond the headlines?

There is a risk that people who will need their DB pension to live on in later life may act upon stories like Altmann doing so and choose to cash in their pension even when it would not be in their long-term interest.

Those people who require the steady income stream a DB pension provides in later life, not as a nice additional extra, need to explicitly hear that taking a transfer value is unlikely to be in their best interest.

That is a message that is not stated often enough, or gets drowned out in the cry of ‘freedom’, as the freedom and choice reforms have been heralded by all quarters.

But it wasn’t so long ago that pension discussions were dominated by ‘gold-plated’ final salary pensions, how to bridge the gap between those lucky ones with DB provision and how to improve the lot for those without.

That is a conversation that still needs to occur. Those with a DB pension must hear loudly and clearly how valuable that provision is, and be warned against relinquishing that treasure short-sightedly.

To this aim, anyone transferring more than £30,000 is legally required to take financial advice. But not to listen to it. And talk of ‘record highs’ and ‘doubling of value’ sure sounds tempting. More tempting than talk around the inflation-proofing a DB pension can provide, for instance.

People should be aware of all the options they have available to them. But with a former Pensions Minister, no less, being shown to sell her DB pension, people may see her as the expert on financial advice and may take this as tacit encouragement to follow her lead.

People transferring out of DB schemes may well be beneficial for trustees and pension scheme managers trying to reduce scheme liabilities and spiralling deficits.

But in the long term it is no good to the industry if people ‘incorrectly’ take the transfer, risking a backlash once the cash runs out. Especially as people can vote with their feet now and completely bypass pensions saving if they wish (and possibly encouraged by the government, if the Treasury’s recent infographic’s pension ‘omission’ is anything to go by).

I’m normally all for encouraging the general public to chat about their retirement savings plans. But discussing the former Pensions Minister’s personal pensions choices? It’s not good to talk.

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