Can you make a Final Salary Transfer Claim?
As the Pension mis-selling scandal rumbles on, more and more people are questioning the advice they received over their final salary transfer.
£Millions are paid out every year in compensation for negligent final salary transfer advice, after people realise that the move was not in their best interests and could have been avoided if they had been given suitable financial advice.
If you think you may be worse off because our your pension transfer, get in touch for a FREE Initial Assessment to see if you can make a claim on a No Win – No Fee* basis.
What are final salary pension transfer claims?
Over the last 15 years, tens of thousands of people were persuaded to transfer valuable final salary pensions away from their companies or former companies, and into riskier personal pensions.
For some, this may have been the right decision (people with a shortened life expectancy, or with no dependants or family members, may be examples of people who might be considered suitable for a final salary transfer).
BUT, many people have been given negligent financial advice to transfer their final salary or other type of Defined Benefit pension.
This is because of general negligence, and also because of the huge fees that a financial adviser can charge for giving final salary advice, or the big commissions they can receive from giving other pension companies business.
Historically high transfer valuations (CETV) haven’t helped either, making it easier for advisers to convince pension holders that they’d get more money in retirement if they transfer, often without explaining the risks.
Why is transferring a final salary pension bad?
Well, that’s not necessarily true!
For some people, in certain situations, it could be a good move.
But these situations are quite rare, and its the job of a financial adviser to determine whether it is right for you and your circumstances – that’s why they sometimes take such big fees.
People moving away from a Final Salary Pension are often not told that they are unable to return to the scheme, and that they may be losing some of the following valuable and often irreplaceable benefits:
- Practically guaranteed income in retirement
- A pension that keeps pace with inflation
- Death Benefits that allow your spouse a large portion of your pension if you die
- No fees or charges to operate
…and by transferring, the pension holder may get:
- A greater risk of losing money through stock-market fluctuations or high-risk investments
- Different death benefits, or none at all.
- To pay operating fees and charges
Final Salary Pension Transfer Comparison
There are sometimes pros and cons to transferring, but as this diagram shows, a final salary transfer is usually the wrong decision for most people.