Armed Forces Pensions are awarded to those who served or are serving in a branch of the British Armed Forces.
Because of the dedication, level of service, physical and lifestyle costs and sacrifices of MOD personnel, these pensions are often a little better than most of the ones you might find in “civvy” life.
A big benefit of these types of pensions for MOD personnel is that they guarantee a payout once you retire, keep pace with inflation and don’t cost you to run them.
However, pre-April 2015, when people were allowed to transfer their army pension, some MOD personnel were persuaded to invest their pensions into risky schemes, which ended up causing many people financial and personal hardship.
If you are a former MOD personnel who transferred your pension pot and lost money as a result, you may still be able to claim compensation. Read on to find out more.
What were the risks with transferring your army pension?
Final salary pensions – also known as defined benefit pensions – can offer outstanding benefits, including a guaranteed income for life in retirement.
While transferring away from a defined benefit pension may have been suitable for some, many people transferred their guaranteed pension into personal pension investments due to negligent or misleading advice.
In short, people were persuaded to give up a pension with secure guarantees for volatile investments.
The laws changed in April 2015 to prevent army pensions being transferred – which protected former MOD personnel from being duped into these unsuitable practices.
Unfortunately, even regulated advisers don’t get it right 100% of the time. In fact a targeted study by the Financial Conduct Authority (FCA) revealed that less than half of the pension transfers they examined featured suitable advice.
Army pension stories: from losing thousands, to winning it back again
After years of service in the Forces, Alan had gained a handsome final salary pension. One day, he received a marketing call encouraging him to transfer his pension to a personal pension arrangement.
However, little to Alan’s knowledge, the caller was acting on behalf of an unregulated investment company.
The advice Alan received was mis-leading and unclear. Alan was promised high returns on his investment and the risks involved weren’t outlined clearly by the advisor.
Instead, Alan’s money was exposed to an investment that wasn’t suitable for him.
Thankfully, Alan contacted Get Claims Advice a – specialist claims management company – and the team there were able to investigate Alan’s case.
The result? Get Claims Advice were able to build Alan’s claim and win back tens of thousands of pounds in compensation. Alan has since been able to rebuild his retirement plans and take regular holidays in Thailand.
It’s not just Alan who has suffered from transferring his army pension.
Mr X left the forces in the late ‘80s and was referred to a financial adviser by a friend.
The adviser recommended Mr X move his pension, without outlining the risks involved, meaning his pension had been mis-sold, financial losses were suffered and he was able to make a claim.
After approaching Get Claims Advice for support on the claim, Mr X eventually won over £100k in compensation.
Mr Z provides another example of final salary pension mis-selling
Mr Z had served 10 years in the RAF before leaving in the early 90s. Like Mr Z, Mr Z was also advised to transfer his final salary pension into an investment without having the risks outlined.
Despite the fact the firm who had provided the mis-leading advice were no longer trading, Get Claims Advice were still able to push forward Mr Z’s claim and win £48k in compensation.
Have you transferred your army pension? You might be able to claim
If any of the pension stories you’ve read are familiar, you might be able to claim for mis-sold pension compensation.
You can do the claim yourself directly to the adviser or pension company for no charge. You can also approach the Financial Ombudsman Service and Financial Services Compensation Scheme for free if and it falls within their remit.
You may have encountered pension mis-selling if you have experienced any of the following:
- You were promised a return on your investment
- The risks of the investment weren’t clearly outlined
- You were pressured into making a decision
- You’ve made a loss as a result of your transfer
Get Claims Advice has helped 1000s of people make successful claims and helped clients win over £78 million in compensation. Their team of case handlers are experienced and come with backgrounds in the financial and legal sectors to offer leading advice.
You can contact Get Claims Advice today by visiting their website HERE or contacting them on 01204 205 061.
Visit the Get Claims Advice exhibitor’s stand at the Armed Forces & Veterans Resettlement Expo taking place in Bristol on October 28.
Register free for the event HERE!