Amongst the most commonly mis-sold types of pension, SIPPs are notorious for causing trouble for hard-working savers. Self-Invested Personal Pensions can be complicated financial products, with many people transferring to a SIPP when the product really isn’t that suitable.
Thanks to the FSCS, you’re protected for up to £85,000 if you’ve been mis-sold a SIPP pension. You can make a claim for compensation for financial and emotional loss. If your claim is upheld, compensation may be awarded.
SIPP compensation claims might help you get your money back if you were mis-sold a SIPP product. Read on to learn about SIPP pension problems and how you might claim compensation.
Read on to find out more about SIPP pension compensation claims, what you can and should do and how Money Savings Advice can help.
What Happens When a SIPP Is Mis-Sold?
A SIPP is mis-sold if you’ve been pushed towards the product without a full appreciation of the risks. Perhaps you were directed just towards a SIPP, though you might also have been offered several different options whilst the drawbacks of SIPPs were glossed over. Even if you feel like you made the choice yourself, you could have been mis-sold a SIPP if you didn’t understand what is involved.
It’s easy to be swept up by words like ‘flexibility’, ‘control’ and ‘financial gains’. These buzzwords make the average SIPP sound like a fantastic pension product. Sadly, the reality is that SIPPs are very often bad choices. Many people lose money by being given more control than they actually know how to handle.
Being unable to manage a SIPP isn’t your fault. Successful investment requires a lot of knowledge, and gambling with your life savings and your retirement funds shouldn’t be the way to test those skills!
Did You Get Bad Pension Advice?
You might have received bad pension advice if you were only told the benefits of SIPPs. You might not have understood that you’d need to be active and carefully monitor investments. You might have been led to believe that your funds would look after themselves for the most part.
Bad pensions advice can mean that people end up with products that don’t meet their needs. Did you receive advice that took into account your current, unique situation? Finding the right pension takes time and effort, so this isn’t something that can be resolved with a ‘one size fits all’ solution.
Receiving bad advice could deplete your retirement savings. You could lose money through no fault of your own, which could damage your retirement plans.
Bad pensions advice is a lot less likely if your advisor is FCA approved. Make sure that you choose a pensions advisor that’s known to the Financial Conduct Authority and will take the time to learn about your plans. To choose the best pensions, advisors should know about your current savings, future plans and intended retirement age.
What Can You Do if a SIPP Was Mis-Sold?
If you feel that your SIPP was mis-sold, you might be able to claim compensation and get back any money that you’ve lost. You’ll be protected by the Financial Services Compensation Scheme (FSCS). Compensation can total up to £85,000, though most people won’t get the full amount.
As part of your claim, decision-makers will weigh up your financial and emotional loss. Joint account claims can get up to £170,000.
The compensation you’re awarded will reflect the value of anything you might have lost. It may include a small monetary figure for emotional distress you may have suffered. In most cases, SIPP pension compensation will help you get your pension savings back.
If you want to know how much of your pension is protected by the scheme, you can use the Financial Services Compensation Scheme’s own handy tool. Just enter your pension details and value, and you’ll see how much compensation you could get if it was mishandled.
How Can You Make a SIPP Pension Compensation Claim?
If you believe that your SIPP was mis-sold, first contact the advisor that sold it. Any good, reputable and FCA-approved advisor should help you to repair their mistake. If you’re unhappy with the offered solution, you can decide to take things further.
You can contact the Pensions Ombudsman to escalate your compensation claim. The Pensions Ombudsman provides a free impartial service to investigate mis-selling claims. If your claim is upheld, you can take things further and claim compensation for your losses.
How Long Do You Have to Claim Compensation?
You have up to a maximum of six years to claim compensation for your SIPP. You should claim within three years of realising your SIPP was mis-sold. You may not realise for a few years that you shouldn’t have chosen a SIPP, so the total six years will give you more time to act if you don’t realise straight away.
Can You Get Help With a SIPP Pension Compensation Claim?
You’re entitled to make a compensation claim without any professional help. Filing your own claim means you won’t pay fees and will keep all the money for yourself.
Many people don’t feel confident making a claim on their own. Solicitors can help with mis-sold pensions, though you will have to pay for this service. Hiring someone else can take the pressure away whilst also increasing your chance of a successful claim.
Your chance of success increases because your claim is led by an experienced and qualified professional.
The Importance of a Paper Trail
Whilst you’re getting pensions advice, and whilst you’re filing your complaint, always keep as much evidence as you can. Save emails, keep letters and take notes of any phone calls you’ve made. A raft of evidence could help to improve your chance of a successful compensation claim.
What Is a SIPP Wasn’t Mis-Sold?
Don’t be afraid to escalate your claim if there’s any chance your pension was mis-sold. You’ve nothing to lose from making a claim unless you pay solicitor’s fees. Making a claim on your own means that you’re taking no risk, and the worst that can happen is that your claim isn’t upheld. If it’s decided that your pension wasn’t mis-sold, you can continue with a plan for the future.
Not every SIPP is mis-sold, even if it doesn’t go to plan. If you were fully aware of how SIPPs work and were told about the risks you’d take on, then it isn’t necessarily a mis-spelling issue if your retirement savings drop.