DB to DC pension transfer

norricorp

Back in 1996, my company sold my unit to another company. They wanted to get us completely off the books and so hired a pensions advisor to advise us whether we should transfer our pension from the company one to our new employers defined contribution scheme run by a third party.
At the time, I asked the advisor how she was paid and was told she was paid by my new company. When she advised we all move and I checked with the pension provider, she had actually received a payment from them as well so hardly unbiased. It was pointed out that the sum had not come from my "pot" but from the provider. Though for the provider that is a cost and costs are met from funds.
I now pay 1% of funds every year. At 60, I am not sure it is now worth moving because a pension advisor will take a few percent but I guess it depends when I decide to cash the pension in. I quite like the idea of a SIPP to give me more control.
Anyway, I am interested to know if there is a time limit when a complaint can be made against bad advice. Though it was over 20 years ago, PPI seems to go back forever. So why not pensions advice?
Perhaps a MSE campaign?
Regards,

Marcon

Time limit is three years from when you knew, or should have known, of the incident about which you are complaining. You've known for over 20 years how the adviser was remunerated so if that gave you concerns, why have you left it so long?

You can't complain on the grounds that the investment performance of your DC fund isn't as great as you hoped. So no need for any sort of campaign - adequate channels of complaint are already there.

PPI is a totally different scenario for lots of reasons - google for more info if you want it.

Dox

Why do you think you received bad advice? The climate in 1996 was vastly different and transferring may well have been good advice. You can't look back nearly a quarter of a century later, decide things didn't work out for the best and complain now.

You've done nothing for over 20 years. What has changed?

dunstonh

At the time, I asked the advisor how she was paid and was told she was paid by my new company. When she advised we all move and I checked with the pension provider, she had actually received a payment from them as well so hardly unbiased.

When she said paid by the new company, is your recollection strong enough to say whether she meant new pension company or new employment company?

After all, what you have said is that she was paid by the new company. Well that is correct. She was paid by the new company. The new pension company.

Unbiased recommendations only apply to IFAs. They do not apply to FAs.

It was pointed out that the sum had not come from my "pot" but from the provider. Though for the provider that is a cost and costs are met from funds.

So, you were correctly informed of how it worked in 1996. So, no issues there. And that does contradict your earlier point.

I now pay 1% of funds every year.

That is pretty good for a 1996 recommendation. It wasnt until 2001 that 1% became a target benchmark. So, this was ahead of the game. Figures of 1.5% to 2.0% were more common in 96.

I am not sure it is now worth moving because a pension advisor will take a few percent but I guess it depends when I decide to cash the pension in

Whilst 1% was good in 96, you can now get around 0.3x%. So, if you used an adviser, there would be an initial cost but there would be a breakeven point.

You can also DIY if you know what you are doing and you mention a SIPP. However, that could well increase your charges as generically, SIPPs are a more expensive option. For example, HL, the UKs largest DIY SIPP charges 0.45% plus fund charges on top. Two of the top selling funds that DIY investors use have over 1.5% charges. So, you would be looking at just under 2% a year. Yet you are not happy with the adviser setting you up with 1% a year 5 years before 1% became the target benchmark.

Anyway, I am interested to know if there is a time limit when a complaint can be made against bad advice.

There are timebars that firms can apply. Both rules need to be met.
1 - 6 or more years from date of sale
2 - 3 years from being reasonably aware of an issue.

However, you haven't actually told us why you think it was bad advice.

Though it was over 20 years ago, PPI seems to go back forever. So why not pensions advice?

PPi does not go back forever. It depends on the distribution channel. PPi is also subject to the 3/6 year rule some use that. Some dont because there is no trigger for the 3 year rule.

Perhaps a MSE campaign?

I doubt MSE will start a campaign just for you.

Nothing you have said indicates any wrongdoing. Your own words contradict yourself. So, what is it that you actually think that was done wrong?