Pension mis-sale; reinvestment

 

Mrs Rossum

6H High Street

Kenilworth

CV8 9CS

 

26^th April 2010

 

Dear Sir / Madam,

 

I am writing with regards to my pension which I believe has been mis-sold. On 19^th November 2002 I agreed to transfer my Friends Provident pension fund of £103,200 to Wesleyan placing it into a SIPP. I was told that the SIPP would be more advantageous as it offers more flexibility.

 

I decided to withdraw my tax free cash in three tranches, totalling £21,300. I then used the remaining £81,900 to purchase an annuity of £5,340 per year from the 4^th September 2007.

 

I have recently contacted a new advisor who informed me that I should have taken out a pension fund with Friends Provident when I reached 60 on 17^th July 2005, which would have been valued then at £113,520. With this amount I would have been able to drawdown the maximum tax free cash of £26,850. The remaining £86,670 could have provided me with an annuity which would have been £5,778 per year.

 

Actual

Tax free cash                £7,150 (19/11/02), £7,650 (22/03/04), £6,500 (04/07/06)

Annuity                         £445pm from 4^th September 2007

 

Notional

Tax free cash                £26,850 on 17^th July 2005

Annuity                         £481.50 from 17^th July 2005

 

Mrs H Rossum

 

Please note: In this scenario, Annual Compound Interest should be used.

Related Topics

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Entry Screen
Actual Adjustment Set
Notional Adjustment Set
Comparison Screen - Interest versus Interest