Warning signs of a mis-sold pension

Not every pension transfer is a smart move. If you were told to move your pension and it didn’t turn out as expected, you might have been mis-sold. The problem? Some advisers push transfers that aren’t right for you, leaving you out of pocket and worse off in retirement.

So how do you know if you’re dealing with a mis-sold pension? And more importantly, what can you do about it? Here are the biggest warning signs to watch out for.

1. Transferring your pension after a cold-call

This is a huge one. We have experience dealing mis-sold pension claims, and almost all of them involve transferring their pensions after a cold-call. Marketing companies can get paid a small fortune for getting somebody to transfer their pension, sometimes as high as 15% of what the pension is worth! Its meant that tens of thousands of calls have been made to people, usually over the age of 45 in the last 10 years.

2. Transferring from a ‘free pension review’

While not all pension reviews are scams, some certainly end up that way. Again, these marketing companies are often unqualified when it comes to financial advice, and aren’t regulated by the watchdog either. Gung-ho sales-staff may not stress the risk involved in transferring, and it can cause mayhem with people’s pensions.

3. Transferring your pension into overseas investments

Although there are plenty of high-risk investments in the UK (think storage pod schemes, land banks and some property funds), a huge amount of mis-sold pensions involve investing overseas. Think forestry schemes, hotels and villas in the likes of the Caribbean or Cape Verde, or farm land and green energy initiatives. These investments are always high-risk, FCA unregulated stuff that could zero your pension balance if they go wrong.

4. SIPPs, SSASs and QROPS

While none of these types of pensions are a scam in themselves, they are the favourite types of pensions for scammers (or at least unqualified marketing companies) to transfer people’s pensions too, as they allow greater control of the types of investments – including those high-risk ones we talked about.

5. Transferring a final salary pension

Final salary pensions are very rare these days, as they are expensive for employers to run, but they also have benefits that can’t be replaced with a personal pension.

Some people get tempted to transfer because of high transfer values, but in the long run, it may have been better to keep them where they are, as its usually much, much safer.

If the person who is looking to transfer your pension is playing down the benefits of a final salary pension, it could be an alarm bell.

Think you’ve been mis-sold? Here’s what to do next

If any of these red flags sound familiar, don’t ignore them. A mis-sold pension transfer can cost you thousands – or even your financial security in retirement. But the good news? You don’t have to just accept it. Many people have successfully claimed compensation for bad pension advice, and you could too.

Checking if you have a case is quick, free, and could help you get back what you’ve lost. Speak to our team today and find out if you’re owed mis-sold pension compensation.