Scottish Widow 'no cost to you' Accident Death Benefit

mariegriffiths

Scottish Widows have written to me to say they are adding 'Accidental Death Benefit' to my stakeholder pension but there is no charge for this additional feature. However I didn't ask for this and have no dependents. The money to support this insurance would surely come out of the fund. A fund that has only lost money over the last few years despite being in the lowest risk category I am allowed. What do others think? Can I transfer this pension for free as they have changed the product?

dunstonh

You really come up with some very strange responses to things. You accused L&G of deception and fraud when they brought in their stakeholder friendly clause which lowered charges on legacy contracts to make them stakeholder friendly. You also made false allegations at me when I responded to questions. Now, here you go again with more strange comments....

A fund that has only lost money over the last few years despite being in the lowest risk category I am allowed.

Which would be their deposit fund. No wonder it lost money given interest rates. Perhaps you should pick more appropriate investment options.

The money to support this insurance would surely come out of the fund.

That is an incorrect assumption. It does not.

Can I transfer this pension for free as they have changed the product?

Really? They add a relatively pointless feature at no cost to you and you think that is breach of contract.

Lloyds have a history of giving away accidental death benefit when they want something. Its a marketing gimmick that comes with very little cost for them. In this case, Lloyds have starved SW of funding and their product range is now poor. So, throwing a cheap gimmick in helps sustain the life of a near dead product just a little bit longer.

bigadaj

mariegriffiths wrote: »

Scottish Widows have written to me to say they are adding 'Accidental Death Benefit' to my stakeholder pension but there is no charge for this additional feature. However I didn't ask for this and have no dependents. The money to support this insurance would surely come out of the fund. A fund that has only lost money over the last few years despite being in the lowest risk category I am allowed. What do others think? Can I transfer this pension for free as they have changed the product?

There should be no bar or cost in transferring so might be best to do that.

Though you need to understand what you are transferring into and what the pros and cons of the alternatives are.

mariegriffiths

dunstonh wrote: »

You really come up with some very strange responses to things. You accused L&G of deception and fraud when they brought in their stakeholder friendly clause which lowered charges on legacy contracts to make them stakeholder friendly. You also made false allegations at me when I responded to questions. Now, here you go again with more strange comments....



Which would be their deposit fund. No wonder it lost money given interest rates. Perhaps you should pick more appropriate investment options.



That is an incorrect assumption. It does not.



Really? They add a relatively pointless feature at no cost to you and you think that is breach of contract.

Lloyds have a history of giving away accidental death benefit when they want something. Its a marketing gimmick that comes with very little cost for them. In this case, Lloyds have starved SW of funding and their product range is now poor. So, throwing a cheap gimmick in helps sustain the life of a near dead product just a little bit longer.

You are an IFA who makes money by selling pensions. IFAs are the chuggers of the financial world so I do not really trust their opinions especially when they use aggression. Pensions are a pyramid marketing scam that have failed. I am trying to lose the least I can on the pensions I was suckered into buying. I chosed the least greedy safest fund. Choosing the riskier option is an excuse for them to say I chose the risky option and lose even more money. With deposit it should not lose money. Even in these times I can get 2.3% fixed so even taking their admin cut of 0.5% I should not lose money. These company's only changes T&C's on existing products to benefit themselves or match legislation.

jamesd

A pension fund doesn't have access to the deposits for low amounts of money that you can use. They are restricted to things that can handle millions of Pounds. Those things pay rates much closer to the Bank Rate decided by the Bank of England. The things they can use are likely to have lower interest gains than the charges at the moment, so a small loss is to be expected.

A stakeholder pension is relatively expensive compared to the alternatives available so indirectly the fund management charges are paying for the insurance. You could presumably avoid this by transferring to another pension product instead of sticking with a stakeholder pension now stakeholders have broadly become uncompetitive on charges.

You could pick a place that allows uninvested cash. That would probably pay almost no interest but it's likely that its only value loss would be to inflation. Alternatively, if you have several hundred thousand Pounds to invest, there are more costly pension products that would allow you to potentially get higher interest rates.

PeacefulWaters

mariegriffiths wrote: »

You are an IFA who makes money by selling pensions. IFAs are the chuggers of the financial world so I do not really trust their opinions especially when they use aggression. Pensions are a pyramid marketing scam that have failed. I am trying to lose the least I can on the pensions I was suckered into buying. I chosed the least greedy safest fund. Choosing the riskier option is an excuse for them to say I chose the risky option and lose even more money. With deposit it should not lose money. Even in these times I can get 2.3% fixed so even taking their admin cut of 0.5% I should not lose money. These company's only changes T&C's on existing products to benefit themselves or match legislation.

Excessive paranoia rather than a balanced analysis.

Good luck.

saver861

mariegriffiths wrote: »

You are an IFA who makes money by selling pensions.

Well, not that I'm a fan of IFA's but I suppose someone has to throw them a crumb if they do the job.

mariegriffiths wrote: »

IFAs are the chuggers of the financial world so I do not really trust their opinions especially when they use aggression.

You would be right not to trust them ... what I would do is double and treble check their suggestions or proposals. If they pan out then run with it - if not, your mistrust will be validated.

mariegriffiths wrote: »

Pensions are a pyramid marketing scam that have failed.

Glad I paid into my pension for all those years .... ain't failed me none, or many others thats for sure.

mariegriffiths wrote: »

I am trying to lose the least I can on the pensions I was suckered into buying.

Did you not have a choice? I was not suckered into anything when I took out my pension. Presumably you could have said 'No'.

mariegriffiths wrote: »

These company's only changes T&C's on existing products to benefit themselves or match legislation.

That would be true largely - but equally you want those company's you have products with to stay afloat and thrive.

I'm thinking a chill drill would be good .... then take a broader view of what you have and where you want to get to. As it stands, I think your own views might be more detrimental to progress than any of IFA's or other representatives.

bigadaj

mariegriffiths wrote: »

You are an IFA who makes money by selling pensions. IFAs are the chuggers of the financial world so I do not really trust their opinions especially when they use aggression. Pensions are a pyramid marketing scam that have failed. I am trying to lose the least I can on the pensions I was suckered into buying. I chosed the least greedy safest fund. Choosing the riskier option is an excuse for them to say I chose the risky option and lose even more money. With deposit it should not lose money. Even in these times I can get 2.3% fixed so even taking their admin cut of 0.5% I should not lose money. These company's only changes T&C's on existing products to benefit themselves or match legislation.

You would be right to be cynical of people's intentions when it comes to money. However you are doing this from a position of gross ignorance, which is inexcusable given the resources available on the Internet. If you do some basic research on this site and monevator for example this will arm you with some knowledge to manage your finances, indicate how you might manage your pensions and align your expectations with what is feasible and matches your risk profile.

Coming in here with a daily mail style rant about the evils of the finance industry isn't doing anyone any favours, primarily yourself, so please try and educate yourself, and if you come back with soem sensible questions people may be able to comment on your thoughts and supply their own opinion.

dunstonh

You are an IFA who makes money by selling pensions. IFAs are the chuggers of the financial world so I do not really trust their opinions especially when they use aggression.

Yet it was you that joined a thread you had no previous posts in and attacked the person answering the questions.

BTW, IFAs do not make money from selling pensions. The product sold by IFAs is advice.

Pensions are a pyramid marketing scam that have failed.

Another dose of paranoia from you to add to your collection.

Even in these times I can get 2.3% fixed so even taking their admin cut of 0.5% I should not lose money.

institutions do not get access to retail products. As mentioned, it will be closer to base rate before charges.

The deposit fund is not the lowest risk fund. It is lowest risk in terms of volatility but it increases in risk when you include inflation and shortfall risks. It is not designed for long term holding. It is a short term home.

If you actually listened to what is being said (both in the past and now) you would not be making bad financial decisions. You need to tone down the ignorance, arrogance and paranoia and educate yourself. Knowledge and understanding is key.

What happened to your L&G pension btw?

AnotherJoe

mariegriffiths wrote: »

I chose the least greedy safest fund.

What specifically was that fund?

And who advised you it was "safest" ?