Skandia CRA transfer to LGPS

cgzz

If your IFA advises you to keep your private pension and not transfer it into LGPS then the best bit of advice I can give you is to make sure your IFA documents the advice and you have a copy with his/her signature on it just in case it all backfires on you. I have been through this already after being verbally advised many years ago not to transfer a private pension into the superior LGPS scheme. I trusted the advice and didn't transfer but with hindsight I am sure the advice was based on the IFA losing his commission. Years later it became obvious that it was bad advice for me as an individual and I raised a complaint. The company that employed the IFA said "we have no record of that advice". The Financial Ombudsman agreed with the company. I am now being paid both my LGPS and private pensions but had the transfer taken place my LGPS pension would be higher than the combined income of separate pensions and that affects me for the rest of my life.

dunstonh

If your IFA advises you to keep your private pension and not transfer it into LGPS then the best bit of advice I can give you is to make sure your IFA documents the advice and you have a copy with his/her signature on it just in case it all backfires on you.

How can it backfire? The OP has two options and both of which could be suitable but only time will tell which will be the most suitable. As it is a hindsight decision (with no clear cut objective to make one choice obvious) you cant go and complain later that the wrong one was chosen.

I trusted the advice and didn't transfer but with hindsight I am sure the advice was based on the IFA losing his commission.

IFAs are now fee based. The fee would be the same either way.

The company that employed the IFA said "we have no record of that advice". The Financial Ombudsman agreed with the company.

There has to be more to it than that as the pension would be set up via an agency belonging to the adviser and the FOS would check that and see if the IFA you are complaining about was paid and the agent. Skandia would tell the FOS who the agent was.

cgzz

dunstonh wrote: »

How can it backfire? The OP has two options and both of which could be suitable but only time will tell which will be the most suitable. As it is a hindsight decision (with no clear cut objective to make one choice obvious) you cant go and complain later that the wrong one was chosen.



IFAs are now fee based. The fee would be the same either way.

So there's no such thing as bad advice? An earlier post listed the benefits of LGPS. Are you saying a private pension like Skandia is as good as a final salary pension with all the other added benefits?


IFAs may now be fee based but fees can still be commission based. Regardless, the Skandia policy will most likely be commission based.

dunstonh

So there's no such thing as bad advice?

Not sure where it said that. I was making the point that a decision to transfer it to the occ scheme or leave it outside is often one of judgement call with pros and cons and that you will only know which is best many years later. Picking the wrong one for the right reasons is not bad advice.

Are you saying a private pension like Skandia is as good as a final salary pension with all the other added benefits?

It can be for an incremental pension. Such as using it as a tax wrapper rather than a pension.

IFAs may now be fee based but fees can still be commission based. Regardless, the Skandia policy will most likely be commission based.

No they cannot be commission based. A fee is a fee. Skandia CRA has effectively been fee based since introduction as the initial charge was explicit and not funded by the provider. Ongoing remuneration on charge basis 1 was commission but charge basis 2 and 3 are fee based.

The more interesting bit about your post was that you made an allegation of mis-sale against the adviser and the response from both the adviser and the FOS was that the adviser you complained about was the selling agent. This would have been verified by Skandia. So, if the adviser did not give advice and was not the selling agent and therefore did not earn a fee/commission, who was?

cgzz

Dunstonh - you seem to assume my experience was also to do with Skandia - it wasn't! It was a completely different provider. All I am doing is advising someone in a similar situation to make sure advice is fully documented just in case the IFA has his own interests in mind (i.e. retaining commission income) instead of having the client's best interests in mind. Whatever the OP decides is ultimately their decision so I can't understand why you are getting all defensive over a simple piece of advice.

dunstonh

Dunstonh - you seem to assume my experience was also to do with Skandia - it wasn't!

Ok. The provider, whoever it was, will still tell the FOS who the selling agent was and who was paid. Something about your story does not add up.

Whatever the OP decides is ultimately their decision so I can't understand why you are getting all defensive over a simple piece of advice.

I'm not getting defensive. I am interested in how your complaint against an adviser failed if the adviser wasn't the adviser and how you think that adviser got paid when they were not the adviser. The FOS would tell you who the actual adviser was. You would then be told to complain to them or they FOS would forward the complaint on to that adviser to deal with.

...in case the IFA has his own interests in mind (i.e. retaining commission income)

what commission are you referring to?

cgzz

Dunstonh - stop making this into something it isn't. It was the same adviser who had been "looking after" (well actually he did nothing apart from making sure he earned the monthly trail commission) my pension for a number of years who told me not to transfer my private pension to LGPS. The advice was given verbally and not recorded and I had nothing to fall back on when it later became apparent that was bad advice.


I now regret even offering a simple piece of advice to the OP when someone like you wades in and makes an issue out of nothing.

Neasy

Don't mean to wade into anything but about 10 years ago when I joined my current employer my financial advisor (tied, not independent) advised me (in conversation, not formally) not to transfer in my c. £45k DC former work pension into the LGPS scheme - too late to worry about it now anyway! His reasoning was that it's not a good idea to have all your eggs in one basket and that the terms of the LGPS scheme were vulnerable to political whim. He was quite right about the terms of the LGPS pension and now that the Chancellor has freed up my DC pot (now worth around £90k; not sure if that represents good performance or not) I'm thinking of using that to bridge the gap between stopping work (whenever that is, maybe in 11 years when I'm 62?) and NPA/SPA.

dunstonh

Dunstonh - stop making this into something it isn't. It was the same adviser who had been "looking after" (well actually he did nothing apart from making sure he earned the monthly trail commission) my pension for a number of years who told me not to transfer my private pension to LGPS

If he was the adviser then how come they and the FOS found he was not?

The advice was given verbally and not recorded and I had nothing to fall back on when it later became apparent that was bad advice.

Yet the FOS found he was not the agent and was not paid a so called commission and no advice was given.

I now regret even offering a simple piece of advice to the OP when someone like you wades in and makes an issue out of nothing.

If you post things on a discussion board that do not make sense and do not correspond with what would normally happen then you should expect to have them questioned.

cgzz

Dunstonh - I'm not going to waste anymore time with your confrontational attitude. Read my first post again and understand it before jumping in and speaking a load of rubbish.