When somebody works hard to earn a living, it’s completely understandable if they want to ensure that every penny falls into the right place, with most of it falling into their savings account. Therefore, many people view pensions as the best way to make their transition to retirement simple and stress-free.
But for them, we have a word of caution: Always trust the right people and get the proper pension plan.
Over the years, we have seen many people who thought they’d found the perfect pension scheme to invest their money in. However, they do not consider that their decision involves risks, particularly if the scheme turns out to be a mis-sold pension.
To ensure you don’t have to suffer at the hands of such culprits, we’ve shared some common types of mis-sold pensions in this blog post that you should look out for.
WHAT ARE MIS-SOLD PENSIONS?
Simply put, mis-sold pensions are when you’ve been persuaded to invest in pension schemes through misleading advice and insufficient information. Mis-sold pensions are generally targeted to people who have a substantial amount of money and are in search of the most lucrative way to transfer their savings with high hopes of attaining benefits in the future.
Keep reading on to learn about some of the most common types of mis-sold pensions.
COMMON TYPES OF MIS-SOLD PENSIONS
Final Salary Transfers
These occurred when someone received their final salary before retirement, and their employer proposes a transfer (of any amount) to a new pension scheme. As the name suggests, final salary transfers are based on your last salary and don’t always lead to good things.
Remember, when you agree to this pension plan, there’s a huge likelihood that you’re handicapped for claiming any guaranteed benefits previously promised by the employer. Additionally, you also risk losing all the savings stored in your existing pension fund.
Self-Invested Personal Pensions (SIPP)
SIPP is not always a problem right off the bat. In fact, they are a great alternative as they enable you to take the lead and gives you complete control to decide what you want to do with the pension.
However, issues emerge when you initiate several purchases. They could belong to high-risk and poorly performing investments that entail expensive annual charges.
Small Self-Administered Schemes (SSAS)
An SSAS is a pension program generally introduced by non-regulated parties, such as product providers and sales agents. They offer investment schemes that usually put their targets at greater risk of ultimately losing all their hard-earned savings.
Transferring your salary to a small self-administered scheme prevents you from facing strict policies and regulations. However, if your financial advisor has caused you financial issues and you have the proof to substantiate their unfitting advice, you can seek a mis-sold pension claim. Make sure to do your own research to find out how.
Closing Note
If you think you are experiencing a risky deal that encompasses final salary transfers, self-invested personal pensions, or small self-administered schemes, keep in mind that you have every right to file a claim for a mis-sold pension.
Whether it is against your employer, pension provider or financial advisor, you should certainly fight for your rights and take back what you’ve worked so hard to achieve almost all your life.
