missold

jillyanne53

i dont know if anyone can answer this,
some years ago my husband and myself
opted out of the old age pension
aand a portion of the national insurance payments
went to a company.
we were told that we would be better off on this government scheme,we now receive our pensions,my husband gets £2.50
a month,i get £64.50 a month.
i believe that the polices were missold but do not know
who to ask.
i have no money to pay a financial adviser,so does anyone know
what i can do.
thank you.

dunstonh

some years ago my husband and myself
opted out of the old age pension

You cannot opt out of the state pension. However, you could contract out of the state second pension (previously called SERPS) and have your NI applicable for that bit paid into a personal pension.

You will still get the basic state pension and any additional pension for the periods you were not contracted out. The insurance company will pay a pension cover the period you were contracted out.

went to a company.
we were told that we would be better off on this government scheme,we now receive our pensions,my husband gets £2.50
a month,i get £64.50 a month.

There are hardly any companies that deal with mis-sold contracting out and one of the main ones that does is currently being invstigated by its compliance company
http://www.ftadviser.com/2013/02/04/ifa-industry/advisory-companies/sesame-to-probe-member-firm-following-poaching-concern-oNRDWKgUvWc8KO2Vc3z9NL/article.html

the FSA did a review of contracting out a few years ago and it found there were possibly 1.5% of people who contracted out were mis-sold. It created a flow chart that indicated that if you were under the age of 45(male) or 40 (female) at the time of contracting out then you were not likely to be mis-sold. If you were over those ages then you may be.

The idea of contracting out is that you may (or may not) end up better off. Some people are, some are not but its considered to be relatively cost neutral. However, there are other benefits from contracting out:

1 - you can take 25% of the contracted out fund as a tax free lump sum. You cannot with contracted in benefits
2 -death benefits on contracted out are usually better than contracted in.
3 - contracted in benefits are subject to legislative risk. The Govt has reduced contracted in benefits 5 times retrospectively but contracted out benefits have been left alone.
4 - you can commence your contracted out pension from age 55. Contracted in pension has to start at state pension age.


The odds of you being mis-sold are low. FSA said just 1.5% could be. The key thing being the age you were when you contracted out. Were you under or over 40/45?

How old are you now and have you commenced the personal pension?