What a CETV actually is
A cash equivalent transfer value is the amount of money your defined benefit (final salary or career average) scheme will hand over to another registered pension scheme in exchange for extinguishing your benefits. Accept it, and your right to a guaranteed income from that scheme ends permanently — the cash lands in a defined contribution pension, where its future depends on investment performance and your withdrawals.
The key mental shift: a CETV is not "your money in the scheme". DB schemes do not hold individual pots. The figure is an actuarial estimate of what it costs the scheme, today, to be released from its promise to pay you a pension for life.
How schemes calculate it
The scheme actuary projects the pension you would receive at retirement — including revaluation between now and then, and increases once in payment — and then discounts that stream of future payments back to a single present-day value. The main ingredients are:
- Your accrued pension and your scheme's revaluation and increase rules;
- Your age — the closer you are to the scheme's retirement age, the sooner payments start, which generally pushes the value up;
- Discount rates, anchored to gilt yields — when yields rise, CETVs fall, which is exactly what happened from 2022 (see what's happened to DB transfer values);
- Assumptions about inflation and life expectancy;
- Scheme-specific factors — trustees set the calculation basis, and an underfunded scheme can legally reduce CETVs (an "insufficiency report" reduction).
Because every scheme sets its own basis, two people with identical pensions in different schemes can receive noticeably different values. There is no universal "market rate" — the only meaningful figure is your own current quotation, so check your scheme's current CETV rather than relying on rules of thumb or old statements.
The three-month guarantee window
Once calculated, your CETV is guaranteed for three months. Within that window, the scheme must pay that exact figure if you complete a valid transfer. The window matters more than most people realise:
- DB transfers involve a mandatory advice process when the value exceeds £30,000, and full advice typically takes weeks or months;
- If the window lapses, the scheme recalculates — and the new figure can be lower (or higher);
- Some schemes charge for additional quotations within the same 12-month period, though your first is normally free.
Practical upshot: do not request a CETV until you are ready to act on it. Line up your adviser first, then start the clock.
How to request a CETV
| Step | What to do | Notes |
|---|---|---|
| 1 | Contact your scheme administrator | Details are on your annual statement or the scheme website |
| 2 | Ask for a "cash equivalent transfer value quotation" | Deferred members have a statutory right to one; active members may need to check scheme rules |
| 3 | Wait for the pack | Schemes must normally provide it within three months of your request |
| 4 | Note the guarantee expiry date | Three months from the calculation date — diarise it |
| 5 | Take regulated advice if over £30,000 | A legal requirement before the scheme will pay the transfer |
What the quotation pack contains
Alongside the headline figure you should receive your accrued pension, revaluation details, spouse's and dependants' benefits, and the transfer paperwork. An adviser will also ask the scheme for extra data — increase rates, normal retirement age, any guaranteed minimum pension (GMP) element — so keep everything together. Missing scheme data is one of the most common causes of delay in the process; our guide to pension transfer timescales covers the others.
Can I transfer only part of my CETV?
A small minority of DB schemes offer partial transfers, letting you move a portion of your value while retaining a reduced guaranteed pension — a halfway house between all and nothing. It is entirely at the scheme's discretion and the split terms deserve as much scrutiny as a full transfer would get; the advice requirement applies in the same way once the transferred value exceeds £30,000. We cover the mechanics in our partial pension transfers guide.
Is my CETV "good"?
People often ask what multiple of their annual pension a CETV should represent. Honest answer: it varies so much by scheme, age and market conditions that quoted multiples are misleading — and values have moved a long way since the low-rate years. A better question is the one an adviser is required to answer: could this sum realistically replace the guaranteed, inflation-linked income you are giving up, with an acceptable level of risk? For most people, the FCA's view is that the answer is no, which is why keeping the pension is the regulator's starting assumption.
If you want to understand what your promised income is worth in today's terms, try our final salary pension calculator, and read our full final salary pension transfer guide before going further.
CETV vs the other figures on your paperwork
DB scheme paperwork throws several numbers at you, and mixing them up causes real mistakes:
- Accrued annual pension: the yearly income you have earned so far, payable from the scheme's normal retirement age. This is the benefit itself — everything else is derived from it.
- CETV: today's cash price for surrendering that income. It moves with markets even when your pension doesn't.
- Commutation lump sum: the tax-free cash you could take at retirement within the scheme by exchanging some pension — completely separate from transferring out.
- GMP (guaranteed minimum pension): a slice of pre-1997 benefits with its own rules; schemes with GMP elements often face extra steps and equalisation adjustments during transfers, which can affect both the value and the timescale.
If your statement shows a "fund value", you are probably looking at a defined contribution plan, not a DB scheme — DC transfers work entirely differently and need no CETV at all.
The advice requirement, briefly
If your CETV is above £30,000, the law requires advice from an FCA-regulated adviser holding pension transfer permissions before any transfer of safeguarded benefits can proceed. The scheme will not release funds without confirmation that advice was given. Below £30,000 the requirement does not apply, but the stakes — surrendering guaranteed lifetime income — are the same in kind, just smaller in scale. An FCA-regulated adviser can model your specific scheme benefits against the realistic alternatives; PensionHelper's role is matching you with one, not advising you ourselves.