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  • FIRST POST
    nimrat
    Serps Review
    • #1
    • 31st Aug 11, 3:57 PM
    Serps Review 31st Aug 11 at 3:57 PM
    I have been contacted by a company that wishes to see if I was wrongly informed regarding opting out of serps. [TEXT DELETED BY FORUM TEAM] They say there are no charges.........I have not done anything as the information they are requesting is not easily found! They are now going to send paperwork for me to sign so that they can look into it for me. Don't worry have been bitten once before and do not intend for it to happen again. I just wondered if anyone else had heard of this company ..........ALSO...........

    I am totally ignorant regarding this serps thing - we did opt out when it initially was offered - on my father's recommendation. Unfortunately he died 16 years ago and I can no longer ask him questions on serps. If we opted out of serps do we still get the state pension. Neither my husband or myself pay into a personal plan and am now beginning to stress about it.
    Last edited by MSE Investigator; 22-11-2011 at 3:46 PM. Reason: Pending investigation
Page 1
  • dunstonh
    • #2
    • 31st Aug 11, 4:26 PM
    • #2
    • 31st Aug 11, 4:26 PM
    I have been contacted by a company that wishes to see if I was wrongly informed regarding opting out of serps.
    I am not going to comment about the company in question but comment generically as I wasnt party to the conversation and dont know what they said....

    There is a small handful of these companies around still. Most thankfully gave up after the FSA review. [TEXT DELETED BY FORUM TEAM]

    I am totally ignorant regarding this serps thing - we did opt out when it initially was offered - on my father's recommendation.
    That means it was not a mis-sale as your father is to blame.

    However, the going by the FSA flowchart, the key point is whether you were aged under 45 at the point of contracting out. If yes, then you were not mis-sold. If no, then you were mis-sold.

    Quite a few companies that still operate in this field do it not to find out if you were mis-sold but so they can find out your pension details and then tell you that you can transfer it to something cheaper or better. In the process they take around 5% commission on the transfer value.

    Thankfully, that will banned within 16 months but for now, they can get away with it.

    If we opted out of serps do we still get the state pension.
    The basic state pension is unaffected by contracting out. Only the SERPS/S2P element of the state pension is affected and only in relation to the period you were contracted out.

    Neither my husband or myself pay into a personal plan and am now beginning to stress about it.
    What is it you are stressing about? Your lack of pension or the fact a cold calling company has spun some ideas in your head which are statisically unlikely to be the case?
    Last edited by MSE Investigator; 22-11-2011 at 3:49 PM. Reason: Pending investigation
    I am a Financial Adviser. Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from a Financial Adviser local to you.
  • dmwg40
    • #3
    • 9th Sep 11, 12:01 PM
    • #3
    • 9th Sep 11, 12:01 PM
    Thanks for this post it helped alot.

    just knowing i was not missold

    i opted out in 1991 when i was 20.
  • Loughton Monkey
    • #4
    • 9th Sep 11, 3:03 PM
    • #4
    • 9th Sep 11, 3:03 PM
    ... Neither my husband or myself pay into a personal plan and am now beginning to stress about it.
    Originally posted by nimrat
    This is indeed something to get stressed about - if you are not saving enough for retirement. Most people are not.

    But don't get stressed about your SERPS. An awful lot of people opted out, and it's all pretty marginal anyway. Any differences between what you will get and what you would have got are likely to be peanuts.

    You should never listen to firms like this that contact you out of the blue. So once you kick them into touch, then go to a 'proper' advisor [probably an IFA] and talk about making proper retirement provisions before it's too late.
  • atush
    • #5
    • 9th Sep 11, 5:11 PM
    • #5
    • 9th Sep 11, 5:11 PM
    I agree with LM, you need to start saving into a pension NOW. If your employer has one, join it. If you both pay tax and they don't , start up a personal pension. And save into CASH and S&S ISAs too. You have lost ground to make up, so get running.
  • jamesd
    • #6
    • 9th Sep 11, 5:45 PM
    • #6
    • 9th Sep 11, 5:45 PM
    You opted out at just about the perfect time, it was probably a very good move. You should get a State Pension Forecast to find out what you can expect from the state pensions.

    If you're still contracted out that will end from next April when contracting out is abolished for everyone. Your pension pot from contracting out will remain, all that'll happen is that like those who didn't contract out you'll start accumulating some Additional State Pension income, in addition to the better known Basic State Pension.

    As with all pension pots you should periodically consider how your contracted out (called Protected Rights) pension pot is invested and whether it is best to leave it where it is or move it.
  • xgingerx
    • #7
    • 6th Feb 12, 6:49 PM
    • #7
    • 6th Feb 12, 6:49 PM
    Bump does anyone have any advice ref serps review , I have worked all my life 20 years and my SERPS pot is only 5k can this be right ? NB I have a reasonably above average pay ? Seems low ? Or is it normal


    Thks
    Dmp Mutual Support thread member No 82
  • xgingerx
    • #8
    • 6th Feb 12, 11:28 PM
    • #8
    • 6th Feb 12, 11:28 PM
    Employed and still opted in, well until april this year when I goes back, maybe I'm worrying about nothing as I've no idea what is right and wrong, obviously 20 years ago I was told it was the right thing to do opting out, hopefully as I'm only 40 this year no damage Is done ? 5k just didn't seem much but honestly don't have aclue
    Dmp Mutual Support thread member No 82
  • dunstonh
    • #9
    • 7th Feb 12, 8:37 AM
    • #9
    • 7th Feb 12, 8:37 AM
    Employed and still opted in, well until april this year when I goes back, maybe I'm worrying about nothing as I've no idea what is right and wrong, obviously 20 years ago I was told it was the right thing to do opting out, hopefully as I'm only 40 this year no damage Is done ? 5k just didn't seem much but honestly don't have aclue
    I suspect that 5000 would only be a couple of years rebates (depending on your income). Ask the insurer for a list of payments received. Contracted out rebates are annual. So, it wont be a long list but it will show you the years that they were received and the amounts. Also apply for a state pension forecast. This will tell you what additional state pension entitlement you have built up. If you have been contracted out for all of the possible period you would have no SERPS or State second pension entitlement.
    I am a Financial Adviser. Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from a Financial Adviser local to you.
  • honizz
    Hi, I noticed that you were talking about Serps. I have a claim going through against Abbey Life at the moment. I opted out when I was 35. Smooth talked I seem to remember, told that State pensions wouldnt be around when I retire and that I would absolutely be better off opting out. As far as I can see, State pensions are still around and noone can tell me if am absolutely better off having been out of Serps. The gist I get from this site is that 1.5% have been missold, I can't find out how many people were told to opt out? Does anyone know?
  • dunstonh
    told that State pensions wouldnt be around when I retire
    Which actually may be coming to fruition as the Govt has proposed the abolition of S2P/SERPS. Early indications are that those that contracted out would be better off financially.

    As far as I can see, State pensions are still around and noone can tell me if am absolutely better off having been out of Serps.
    In 1996, the SIB did a review and found that everyone who had contracted out up to that point was financially better off. In 1997, Labour got into power and reduced the rebates. This made contracting out harder to beat contracting in. Since then, its generally been cost neutral with the main benefits being no linked to state pension age and the ability to get 25% tax free cash.

    Its quite easy to see if you have been better off by contracting out. However, you have to speak to the right people. It is not something you can guess.

    The gist I get from this site is that 1.5% have been missold, I can't find out how many people were told to opt out?
    It was just under 1.5% and it was only potentially mis-sold. Not actually. Over 8 million were told to contract out. Data was published by the FSA.
    I am a Financial Adviser. Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from a Financial Adviser local to you.
  • honizz
    Oh dear, still all if's and but's why can't financial people tell it straight. It was the same with my endowment, "you will get twice as much back so this will help fund your retirment" was said to me when the endowment was sold. When it matured I got half back what the basic amount was. If you are promised one thing and then this doesn't happen or is not absolutely clear that it is happening then to me thats bad advice?

    If I told you to pay me 50 per month for 25 years and I will double your money and then after 25 years you half my money, thats not right. Its ok to say there was paperwork to say it goes up and donw and is not guaranteed but if you are sitting with a financial adviser who is very pro endowment and will not say a bad thing you have to take something from that, that is the advice is it not?

    The Serps plan may well be a good plan, but if it was sold to me incorrectly then I may well be within the 1.5% of 8 million? Thats 120,000 people. If there are so many why don't the Industry sort that out.

    I was younger and naive I was in a pub with my friend and within 10 minutes of being approached by a financial adviser we were both opted out. I wouldn't have done it if I hadn't received that advice, was that advice in my best interest? I don't know, I do know that the adviser who gave the advice didn't know because they didn't take any info except what he needed for the form.
    Sorry for the rant!!
  • jem16
    The Serps plan may well be a good plan, but if it was sold to me incorrectly then I may well be within the 1.5% of 8 million?
    Originally posted by honizz
    Unlikely. At age 35 you were in the correct age bracket to be contracted out. However as Dunstonh says, perhaps you should speak to an IFA if you are really that concerned about it.

    I was in a pub with my friend and within 10 minutes of being approached by a financial adviser we were both opted out.
    So you made an important financial decision on the strength of someone in the pub coming up to you? How do you know he even was a financial adviser?
  • dunstonh
    Oh dear, still all if's and but's why can't financial people tell it straight.
    That is because it is all ifs and buts. You want a crytall ball and there isnt one. Who knows what Govt legislation is going to be in future.

    The Serps plan may well be a good plan, but if it was sold to me incorrectly then I may well be within the 1.5% of 8 million? Thats 120,000 people.
    What evidence do you have to say it was sold incorrectly. Also, remember that you are applying the rules in the year you did it. not todays rules. At your age, you were best to contract out anyway. So, you wont be in that 1.5%.
    I am a Financial Adviser. Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from a Financial Adviser local to you.
  • honizz
    Did you mean to say it was best for me to contract out? How could you possibly know that. If the FSA according to you say that 120000 were badly advised I might be one of them.
  • dunstonh
    Did you mean to say it was best for me to contract out? How could you possibly know that. If the FSA according to you say that 120000 were badly advised I might be one of them.
    The FSA flow chart says you are not. Basically if you were under the age of 45 at the point of contracting out then you were not mis-sold. The 1.5% applied to those above age 45 when contracting out. However, it is only potentially mis-sold as there were period when rebates were sufficient to allow contracting out at a later age.
    I am a Financial Adviser. Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from a Financial Adviser local to you.
  • honizz
    tinypic.com/r/10qgugx/5 ( this is a copy of my award letter with calculations. I have removed my personal info)

    I won my claim in the end although they rejected it initially. I was actually 32 when opted out and Dunstonh given your last message I almost cancelled the whole claim.

    I tried to put a copy of my letter on this site but couldn't put attachments so I found a website that uploads pictures. If you copy and paste the code at the beginning of my text into a browser, it may appear. Although given my lack of pc skills it may not.

    Anyway I for one will never use this site again as it almost cost me 9k.

    Honizz
  • dunstonh
    Anyway I for one will never use this site again as it almost cost me 9k.
    Cheerio

    I won my claim in the end although they rejected it initially. I was actually 32 when opted out and Dunstonh given your last message I almost cancelled the whole claim.
    You got lucky. Being Abbey life that could be due to missing paperwork or any number of fluky reasons. The FSA flow chart clearly states under age 45 as not being a mis-sale and under 1.5% of people were potentially mis-sold. It doesnt account for firms that have poor administration.
    I am a Financial Adviser. Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from a Financial Adviser local to you.
  • jamesd
    Congratulations on the very much against the odds success!

    From the look of the calculation the investments you've used did pretty badly so you ended up today showing a possible total investment loss of 2,073, spread over around the 23 or so years that half of man retiring at 65 can expect to live beyond. So a loss of about 90 a year or 1.73 a week.

    Most of the payment is 5,609 in investment fees that you wouldn't have to pay if contracted in.

    While the investments you chose didn't do very well you've gained by the ability to take the pension income at age 55 instead of state retirement age and the ability to buy a single person's annuity instead of a dual life one.
  • honizz
    Not that many of you will care too much but I may not leave, Dunstonhs reply of cheerio is not unexpected. Not very good manners for someone who almost cost me 9k, I thought IFA's were meant to make money not lose it... The reason I made a claim was because my friend had made a claim about 13 - 14 months ago, she was a couple of years younger than me but she won too so in my experience its not that unusual. Anyway I'm a little annoyed at the moment otherwise I wouldn't waste my time on here. Off for a stiff coffee..
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