There are so many people who have no idea about a mis-sold pension. You must have heard about this in the news, and it might even have happened with your relatives or might have happened to you. A person spent all his life working and saving so that he/she can spend their after retirement time happily without any worries. According to reports of the Financial Services Compensation Scheme, in 2018, there was an overall accumulation of £40 million for compensation which was paid to individuals who were mis-sold pensions.
You might have heard about mis-sold pensions but do not have deep knowledge regarding it. This post might help you in guiding you and saving you from investing in a risky business. If you feel you were scammed and mis-sold pension, you can file a mis-sold pension scheme to get compensation and advice.
The question is, how will you know that you may have been mis-sold a pension? For that, you have to keep reading this post.
- 1 What is a Mis-Sold Pension?
- 2 This can include the following:
- 2.1 1. You were given a cold-called
- 2.2 2. You were not properly guided with the terms and conditions.
- 2.3 3. Lack of Absence of Paperwork
- 2.4 4. Guaranteed Returns on Your Investments
- 2.5 5. You were not given proper information about your pension charges and fees
- 2.6 6. Your Investor lied about their qualification and experience
What is a Mis-Sold Pension?
You may have heard this term; however, it will be no surprise if you do not understand the basics of mis-sold pensions , as many don’t. You can say you have a mis-sold pension when you have been given wrong information, which was misleading and unsuitable. Say, for example, you were told to remove your pension from the work scheme and put it into a SIPP scheme, and you were promised that you would get more return from what you would get from your standard pension, but you did not get what you were promised. This can be said as misleading or unsuitable advice.
A “mis-sold pension” doesn’t simply depend on the Investor’s recommendation. Truth be told, it very well, maybe because of the actual investments. In the event that you were not told about the expense of these payments or the sum that would accompany losses in the future, this is an illustration of how you were unreasonably unfairly convinced into the investing.
Workers that are mostly affected by the mis-spelling of this form of pension are teachers, civil servants, police,NHS workers, railway workers, firefighters, and armed forces or blue-chip companies.
The worst part is that you must have signed into an agreement without knowing that it included unregulated investments.
This can include the following:
You had no idea about the unregulated investment being a part of the deal; it was too late when you did. This is the reason why you lost all the savings that you did for pension.
If you are investing your hard-earned money, you must be very sure and gain enough knowledge about your pension scheme, especially if you are going with a SIPP scheme. Checking all the details lets you know all whereabouts of your invested fund.
Let’s Look into the top signs To know you may have been mis-sold a pension
1. You were given a cold-called
When an investor calls you out of nowhere and gives you an offer to increase your pension, that is called cold-calling. This is one of the most prominent warning signals when a pension scheme is offered through cold-calling.
These calls will come from an unknown number, and the Investor will have no idea about your personal savings, job, or anything as such. These calls are generally made to pounce on the opportunity to make more money, and these end up being scams.
2. You were not properly guided with the terms and conditions.
If your Investor has not explained or could not explain all the terms and conditions in the agreement, you can take this as a signal that you were mis-sold your pension. When you are investing your hard-earned money, you will obviously want to know everything about it. Your Investor must explain to you all the parts of the contract and especially highlight the important points before giving it to you to proofread and sign.
3. Lack of Absence of Paperwork
If you are investing and giving up your finance, you will definitely want all the appropriate paperwork to back up your investment; that is very obvious.
Always remember every investment must come with paperwork containing all the information and details of your investment. Information such as, what are you investing in?
What will be the return on investment? Duration of your investment etc. The paperwork must also contain all the information about the risks that can result in losing money.
Having appropriate paperwork with all information will give you a valid point to decide whether you should invest in the pension scheme or look for other alternatives.
If your financial consultant is tricking you by telling, there is no paperwork or less paperwork to keep things simple, that is a danger sign, and you should not by any means fall for it.
4. Guaranteed Returns on Your Investments
There is never a 100% surety of return in investment. Most of the mis-sold pension happens due to promise or guaranteed return. An investor sometimes promises a lot more than it is likely to be delivered as per the market situation. It’s better you do your study before believing blindly in others.
Your Investor can show you evidence of people who have received a high return from certain pension schemes, but they can never give assurance about the return. If an investor is doing so, it’s a danger sign, and it also indicates that maybe your Investor does not know much about the investment he is selling, the reason why he is giving examples of other pension schemes
5. You were not given proper information about your pension charges and fees
Sometimes financial advisors don’t make pension holders aware of the pension charges and fees. This can sometimes lead to the pensioner paying more money for charges and fees than their actual earnings from a pension. This is the reason why you must give proper attention to all the details of your investment.
6. Your Investor lied about their qualification and experience
When you meet your Investor, it may be he is lying about his experience and education qualification when asked. A qualified financial advisor is more trustworthy and looked for. If you feel there is something wrong with what the Investor is telling you can just ask for his qualification certificates awarded by the Chartered Insurance institute which can be easily made available if he is not lying.