Defined benefit transfers have become the challenging area of advice that many advisers are grappling with today.

Haunted by the memory of past debacles – pensions mis-selling, endowments and split-cap investment trusts – advisers are wary of suggesting the wrong advice and putting people down the wrong path.

The challenge has been created by George Osborne and pension freedoms that he created. Targeted primarily at those with DC schemes who had few options other than buying an annuity at retirement, pension freedoms started to be picked up by those who were preparing for retirement on a final salary scheme.

To the uninitiated, cashing in at least some of one's pension seemed compelling. It would be far more attractive to get a lump sum to spend on home improvements or a fancy holiday, rather than live out one's days on a meagre income, but it has been challenging to sell the benefits of a reliable, if modest income, for the rest of one's days, against the tantalising prospect of a lump sum today.

In the early days of pension freedoms, many advisers were worried about 'insistent' clients. What should they do when a client instructs them to go against their own advice?

But since the day of the European Union referendum last year, the scenario has changed. Shortly after the vote, which saw gilt yields go down, pension funds had to raise their cash equivalent transfer values, meaning that to create the income they would expect, projecting into the future, using the same assets, would require a bigger investment fund.

This meant, that at a certain point following the Brexit vote, cashing in one's 'gold-plated' pension, seemed not such a bad idea.

And there are certain personal situations in which cashing in might seem a sensible idea – a single man in ill-health being a typical example. 

So DB transfers have become a minefield for financial advisers, especially since a good decision today might not look like a good decision in 10 or 20 years. But no one has a crystal ball, and no one know when the next financial shock might come or what impact that might have.

Melanie Tringham is features editor of Financial Adviser