Self-Invested Personal Pension (SIPP) are generally regarded as unsuitable for people with little investment experience, investors with a firm understanding and capacity for financial risk are typical of those most suited to this type of pension scheme. However, many Financial Advisers have recommended SIPPs which are not in the best interest of some of their clients.
Personal Pension Transfers Essentially, a mis-sold pension is any kind of pension scheme in which you were persuaded to invest, which involved taking your money out of safe investments to go into unregulated investments, often for the investment to perform poorly, sometimes to the point where the entire pension fund is lost. These transfers are typically sold with the promise of incredible returns and a comfortable retirement. But, in truth, they can lead to devastating financial consequences for an individual.
Final Salary Transfers A final salary transfer is when your employer looks at your final salary and, based on your last known pay, offers a figure to move across to a new pension product. This kind of transfer is very rarely a good idea. By transferring a final salary pension, you lose any guaranteed benefits as well as risk losing the money in your pension pot. If you’ve been wrongly advised to do this, you may be entitled to mis-sold pension compensation.
SIPP Operator Some SIPP operators have entered into dealings with third party advisers who are not authorised and regulated by the Financial Conduct Authority to give pension or investment advice. This is despite their regulatory body publishing alerts and giving warnings against such actions. This has resulted in pension plans that have previously been invested in regulated funds and assets being transferred to SIPPs with high risk, unregulated products which are not suitable for the average investor. In many cases this has led to people suffering devastating financial losses on their pension funds which they have spent their entire working lives saving for. In some situations, the full pension fund has been lost completely. This has led to many complaints, against the SIPP operator. If you’ve been misled in this way, you could be eligible to make a mis-sold pension claim.