MSE News: 'Rip-off' pension exit fees to be capped

Options
2»

Comments

  • saver861
    saver861 Posts: 1,408 Forumite
    Options
    dunstonh wrote: »
    Most of these contracts that are now considered unfair would have been built in the period of high inflation, boom/bust. They were priced to that model.

    Ok that's a fair point that I had not considered. However, from that perspective there has been no inbuilt flexibility for inflationary changes?
    There is no evidence of that.

    Well I would not expect reputable companies to be doing it in any case, not that I am naive enough to think they will not stretch any advantage they can get.
  • Paul_Herring
    Options
    saver861 wrote: »
    Well I'm not sure how it is perceived if they are unfair 'now'. If these fees were stipulated at the time of initiation, then one presumes they were unfair at that point also. Why was it not dealt with before now?

    Maybe we should get WASPI involved.... :rudolf:
    Conjugating the verb 'to be":
    -o I am humble -o You are attention seeking -o She is Nadine Dorries
  • dunstonh
    dunstonh Posts: 116,649 Forumite
    Name Dropper First Anniversary First Post Combo Breaker
    Options
    Ok that's a fair point that I had not considered. However, from that perspective there has been no inbuilt flexibility for inflationary changes?

    You are mostly going back to 1970s-80s contracts (with a small number creeping into early 90s). Software was hard coded and contracts were contracts. Flexibility was not a word heard of.
    Well I would not expect reputable companies to be doing it in any case, not that I am naive enough to think they will not stretch any advantage they can get.

    Interestingly, some of the companies that have appeared in the media supporting the abolition actually have exit charges. Just under a different name. Both HL and A J Bell appeared in the press supporting the abolition but both of them have exit charges.
    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.
  • Linton
    Linton Posts: 17,246 Forumite
    Name Dropper First Post First Anniversary Hung up my suit!
    Options
    saver861 wrote: »
    ....... However, from that perspective there has been no inbuilt flexibility for inflationary changes?


    Insurance companies lost a lot from the lack of "inbuilt flexibility for inflationary charges" as many pensions set up in the early 80s had guarantees appropriate to inflation of >10%. When inflation fell the insurance companies still had to pay out. Some went bust or were perhaps bought out as the only alternative. That's what happened to Equitable Life. All of us, including actuaries it seems, have difficulty conceiving of a world very different to the current one.
This discussion has been closed.
Meet your Ambassadors

Categories

  • All Categories
  • 343.8K Banking & Borrowing
  • 250.3K Reduce Debt & Boost Income
  • 450K Spending & Discounts
  • 235.9K Work, Benefits & Business
  • 609K Mortgages, Homes & Bills
  • 173.4K Life & Family
  • 248.5K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 15.9K Discuss & Feedback
  • 15.1K Coronavirus Support Boards