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Friend 'lost' £20k after transferring Pension?
Comments
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One thing i must say is that he was advised to move his fund from the Works pension that paid him 3% per month to 'Met life' and he did so but still kept his works fund and contributed to this as usual to keep getting his 3% from his employer.
Is this mis-selling?
Hard to tell. There is nothing wrong with moving the funds from one pension to another, and keeping his company pension running is a no-brainer. However, why were the funds moved? I move funds to keep fees down while keeping (roughly) the same risk level, but moving using an IFA isn't exactly the best way to keep fees down.I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.
Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.0 -
No Misselling, and yes he is still responsible for the advice he gives.
If he isn't worried, I don't expect you should be either. Hopefully you have a pension?0 -
I do around 250 pension transfers a year. Most are an absolute doddle to justify and often see figures in the tens of thousands of pounds range as the gain from transferring. The biggest gain has been over £300,000. So, a £20k loss in context (and noting the recent 20% market downturn) needs to be placed in context.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0
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atush,
1, Yes i am about to join up.
2, He is worried but has no b***s. He claims that when it came to completing the transfer and sorting out the fees he said to the IFA "You go ahead and sort it all out, i'll just sign it'. A few years down the line he is confused as to what charges he was charged/is paying. Fool.Not yet a total moneysaving expert...but im trying!!0 -
The key reason to use Metlife is for the guarantees and market lock-ins. For instance, if on an annual lock-in the fund is higher than the original investment amount or previous higher lock-in, then the higher amount is locked in, with a ceiling of 10% on annual lock ins, or unlimited on 2.5 year lock-ins.
The IFA would have been unlikely to encourage your friend to make regular contributions to a Metlfie plan as the minimum contribution is probably higher than he normally contributes, he would lose the employer's contribution, and the lock-ins/guarantees do not apply to regular contributions.
One of the difficulties in commenting on something like this is that your friend who doesn't understand pensions has told you (who knows a bit more) bits of what he has gathered from his memory and it's all out of context.I am an Independent Financial AdviserHowever, anything posted here is for discussion purposes only. It should not be considered as financial advice.0 -
2, He is worried but has no b***s. He claims that when it came to completing the transfer and sorting out the fees he said to the IFA "You go ahead and sort it all out, i'll just sign it'.
Do you remember the Star Trek where the transporter splits Kirk into two? Maybe that happened to your mate and me?
I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.
Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.0 -
Ha ha, i refuse to believe that!!
FYI- it was The Next Generation i believe! Will Riker!Not yet a total moneysaving expert...but im trying!!0 -
Ha ha, i refuse to believe that!!
FYI- it was The Next Generation i believe! Will Riker!
Naaaa!
http://en.wikipedia.org/wiki/The_Enemy_Within_(Star_Trek)I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.
Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.0 -
Since the transfer didn't stop him from getting the ongoing 3% from work that part wasn't mis-selling.
Knowing when the pension was transferred and when the £20,000 loss happened - before or after that - would be of interest. However the time of the loss does coincide with a major drop of the stock markets worldwide so most people would have seen a significant drop around then and 20% would be small compared to many of those drops.
Need to know more about relative timings and how the investments were changed to have more idea but at the moment it looks as though the drop in value wasn't really related to the transfer.0 -
In fact, it smells of miss selling to me.0
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