Fight or Flight with your mis-sold pension investments
Losing your pension through a bad or even fraudulent investment is a terrifying experience, filled with its own special brand of heartache and worry about your future financial position.
Worse than that, it happens all the time too! Despite the fantastic efforts of the Financial Conduct Authority and other official bodies, too many people lose their nest eggs each year due to a variety of pension scams, dodgy advice as well as high-risk and unregulated investments posed as safe and regulated ones.
Sadly, if you are now in a position where you can say “I’ve lost my pension”, any advice about how to avoid these investments would now come a little late (although probably still worth reading, there are some sharks out there and it’s not impossible to be stung twice).
But if you really do appear to have lost your pension, you may still have a choice: Fight or flight.
1. Simply accepting what’s happened with your lost pension and chalking it up to experience.
If you can truly afford to lose your pension and not put up a fight for it, then you’re probably in a pretty enviable position. Studies have shown that most people feel they need around £23,457 per year to enjoy the retirement they wish for, meaning a total pot of £469k to be drawn at around 5% for 20 years! (Source ThisIsMoney.co.uk)
The chances are that if you have truly lost your entire pension then you are in a sticky spot, and if you have enough time before your planned retirement, you’re going to have to save pretty hard to recoup it. If you can manage it, then fine, but you need to ask yourself that tough question of whether you can afford to just lie down and take the financial pain.
2. Stand up and fight for it – the authorities and making a claim
If your money has been lost to fraud or a serious criminal element, the chances are you may be able to get your money back once the court proceedings go through against the guilty parties. There have been a few examples of this in recent years.
Biofuel investment Sustainable AgroEnergy is one such example, with Gary West, James Whale and Stuart Stone all sentenced on bribery and fraud offences following a Serious Fraud Office investigation back in 2014, with legal proceedings to establish compensation and confiscation orders against the three defendants already underway, but as with many other investments, there’s more that you can do to put your pension piggy-bank back on its feet…
Mis-sold pension – Making a claim
Unless you took it purely upon yourself to invest your money in the now failed investment scheme (or worse, a scam) the chances are that at some point you took advice from an Independent Financial Adviser.
Financial Advisers (or IFAs as they call them in the industry) should be well trained, generally accredited and have their actions REGULATED by FCA.
It could be that through this regulated advice, the now failed investment that they advised you place your pension was unsuitable for you in the first place, and this is how you could get your money back!
Especially if you invested as part of a SIPP (a Self-Invested Personal Pension), your adviser should have checked your suitability for investing, determining what kind of investments they can recommend to you.
For high-risk and unregulated investments (not backed by the FCA or FSCS safety net), investors should be classed as High-Net-Worth Individuals (earning over £100k per year, or have assets worth over £250k not including their primary home or pension), and/or should be a Sophisticated Investor, with a wealth of knowledge and experience about investing, leaving them capable of running their own pension pot safely.
If you don’t fit this description but were advised to put your money into unregulated investments such as overseas property, tree and timber plantations, carbon credits, biofuels and bonds, then you may have been mis-sold your pension investments and you could be able to make a financial claim to get your money back. It could be that your adviser didn’t tell you that your investments were unregulated – even worse!
Even if your financial adviser has ceased to trade and gone to ground, if you were mis-sold by an IFA who was regulated at the time, the FSCS may be able to sort you out with compensation to top your pension pot back up, capped at £50,000!
Chasing your mis-sold pension doesn’t have to cost much, or even anything at all.
Get Claims Advice specialise in mis-sold pensions and can handle all the paperwork for you – just read, understand and sign to let us get to work on a NO WIN – NO FEE basis*.
So, the choice is yours, FIGHT or flight?
Pension doing just fine? We’re glad to hear it, but it could be that it is still high-risk and unregulated, meaning it could have still mis-sold to you under the same rules. If it was mis-sold to you, then you could be due compensation, and you can still keep your investment if it makes it’s promised returns.