Safety first
AFTER your health, your pension provision is one of the most important considerations as you approach retirement and later life.
Most people, if diagnosed with a medical condition that required surgery, wouldn’t dream of allowing anyone near them with a scalpel other than a certified medical professional, yet the same rules do not seem to apply to financial advice.
Too often people allow firms which are not suitably regulated or authorised to take control of their future financial wellbeing with often disastrous consequences.
Recent reports in the media have highlighted growing concerns over unscrupulous companies “luring” Tata Steel workers into transferring their money out of their pension funds into other, often risky, investments for a substantial fee.
This is not an isolated case and demonstrates that, like with the
PPI mis-selling scandal and the subsequent deluge of cold-calling companies springing up, there are plenty of unscrupulous firms out there who want to get their hands on your money.
Often, the company contacting you is not a regulated firm at all – all they’re looking to do is receive a fee from somebody they ultimately pass the enquiry onto. Effectively they are simply acting as an introducer.
What all this highlights is the need for to think ‘safety first’ and be wary of any company that approaches you about any aspect of your finances, especially when it concerns something as important as your pension.
Given the tone of this you may find yourself concerned about where to turn for advice when you need it. Don’t let this put you off, an experienced adviser can add a great deal to your financial wellbeing.
We just suggest that you do the basics first to ensure that whoever you go to is regulated to give the advice you need. Always remember that if anything sounds too good to be true or you are promised a high return with low risk you should start backing away from the situation as quickly as possible.
Many firms purport to be regulated and use incentives to secure leads and draw new business in. In the case of the Tata Steel workers it was reported that introducer firms have been organising receptions at hotels, complete with free meals on offer to attendees.
Perks like this together with attractive initial offers can seem appealing, especially to those who are in difficultly or who don’t fully understand the range of options available to them. But in many cases signing up without proper due diligence can create serious problems further down the line.
It is essential that you always thoroughly research any company before you engage them to undertake work for you. Any regulated firm will be on the Financial Conduct Authority (FCA) register which can be checked by visiting the following link: https://register.fca.org.uk/
Dealing with an unauthorised firm means you are not covered by the Financial Ombudsman Service or the Financial Services Compensation Scheme. Remember, the value of your investments can go down as well as up. Past performance is not a reliable indicator of future outcomes. Andy Pulford, Director and Independent Financial Adviser at Faron Partnership Ltd Andy lives in Wokingham and has worked as a financial adviser for over 30 years. He is married with three grown-up children. Faron Partnership offers personal financial advice, including retirement, investment and estate planning. Any information or views expressed in this article should only be acted upon within the context of your own circumstances with the help and guidance of a professional financial adviser. Faron Partnership Ltd is an independent financial adviser which is an appointed representative of ValidPath Ltd which is authorised and regulated by the Financial Conduct Authority.