As with any pension scheme, problems are only ever highlighted when you least need them to be, namely when you need the money. Anything to do with pensions such as self invested pension schemes are an incredible challenge in that you only find out if there is a problem many years in the future. By the very nature of pension’s values they only have any real meaning when you’re drawing on the pension or about to draw on the pension.
Reasons for Claiming against a Mis-sold SIPP
1/ The risks
When you invest money in any pension there are always risks attached, they should have been explained to you fully. Risks can form a number of different areas but the most important is your adversity to taking risks as pension schemes can have your money spread over many different forms of investment. To meet any individuals investors need and financial position.
2/ Sales pressure
This is not unique to the missale of pensions or pension advice provided by advisers but due to pension values, the long-term nature of pension products and the high commissions available for longer riskier policies. The potential for an adviser to maybe exceed your comfort zone to generate more commissions is great. This does not mean that advisers are all crooked but additional income can be derived by them quite easily by suggesting a product which might not be appropriate for your situation.
Advisers are not infallible and if they do give poor advice this can lead to financial loss view in the future. It is worth checking their advice on making sure your investment in your pension in the future is safe.
Your adversity to risk
This is always an area of confusion. The adviser has to establish your adversity to risk in relation to your pension. They will do this by simple questioning but also looking at your own financial situation. If you’re a millionaire with millions of pounds in the bank and you’re looking to invest £50,000 you are probably happy to take a risk. If you have the same money to invest but have a small family very little in the way of savings then your risk would be the other way around. And whilst you may wish to gamble a little on a high-risk investment the adviser should be advising you against this.
As always the difficulty is that advisers are paid commissions and higher investment risks means more money to them.
If you believe you have been mis-sold a pension product we can of all course review this for you and assist in any remuneration or refund should a case for mis-sale be proven. All of this would be on a no win no fee basis where our fee is 20% plus VAT (24% equivalent)
Frequently Asked Questions
What is a SIPP?
A SIPP or self invested pension scheme is a pension plan where you contribute either monthly or lump sum amounts to a pension pot which you have control over via an adviser.
What can go wrong with a SIPP?
Due to the amounts involved concerning SIPP schemes and the length of time normally involved until retirement anything that is incorrect at the start can considerably affect your retirement provision.
Are SIPPS useful?
Like any form of pension SIPPS are incredibly useful in providing for your financial needs at retirement. The correct product and risk attached need to be correct to meet your personal situation.
Why would a SIPP be missold?
Incorrect advice in relation to a SIPP is not uncommon. The provider or adviser has strict guidelines to follow in promoting products and if this is not provided a mis-sale can occur.
Why is a missold SIPP bad?
Any bad financial advice needs to be addressed as it can have serious consequences in this case on your future financial needs upon retirement.
Should you check your SIPP?
If you have a SIPP it is worth checking to make sure that the advice at the point-of-sale was correct and appropriate and met with your financial situation at that time as well as your future financial requirements.