Pension Robbery by Financial Advisors

frebak · 2006-05-27T13:23:09+00:00

Apart for having a Labour Government put tax on dividends and undermine the whole point of saving money in Pension Funds there is the Financial Advisor. A better term for these people would be Financial Rogues. I have just been quoted the following Commissions for; "Saving for retirement" - 25 year term 50% of the first 12 month's payments plus 0.5% of all payments from month 13. "Savings and Investments" - Personal and Stakeholder pensions; 4.77% of the amount you invest. So there could be a year's profit gone immediately! To cap it all At Retirement - You actually have to pay again! e.g. Commision on Income Drawdown; 5.09% of the amount you invest plus 0.75% of your fund value each year from year 2. What work is involved? Income Drawdown is like taking money out of a bank. Phone your Fund Provider when you wish to take money out and record the yearly sum on your tax return. All that is required is a table of what you are allowed to take out given your age and credit. - What could be simpler! Deliberately making things sound complicated is an attempt to justify their fees. The worse thing is that you have no choice. You are forced to use these beggars by the Inland Revenue. What is the best way of getting redress from these people?

May 27, 2006 42 Replies

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neil 20 years ago

OK, I see what you mean.

Asking for 4.5% still seems a bit steep, compared to the amount of work I guess would be involved (not a huge amount). If you had 17 different pension plans that were to be amalgamated, it could be, but if there is only one plan being transferred, it should be relatively straightforward.

Ask them to quantify what they will be doing to justify such an amount.

I think the main problem with many IFA's who just are'nt moving with the times is that they still rely on 'big cases' to get them out of the s*it, rather than work on a purely fee-based structure or make charges based upon their clients entire assets under management.....

Neil.

Fred wrote:

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Fred 20 years ago

As John Boyle said earlier:-

"Sounds like a stitch up. As you suggested earlier, the company wanted you out of the scheme so got the IFA to do the dirty work."

This IFA specialises in companies who employ some 20+ workers say. Theses guys are totally ignorant of IFAs and all the skulduggery involved.

The IFA looks after their pension scheme and because this nice man is so helpful and who has helped so many others they have no doubt that he is giving them the best advice when they leave due to retirement, redundancy, resignation etc.

So the IFA gets away with charging what he thinks he can get away with. The guy is removed from the company pension scheme at the minimum transfer value and the company scheme is quid's in, the IFA is quid's in. The guy has in fact been robbed by all the people he trusted.

Any corrupt IFA is on a roller.

Fred

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BeeJay 20 years ago

Agreed: and the sad part is that many of these people boast about "my financial adviser" as though it's something to be proud of.

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