You may have come across the term mis-sold pension, and maybe you are wondering what it is and who it affects. A mis-sold pension happens when a pension scheme operator or financial advisor convinces you to transfer your retirement benefits from its initial safe investment to a shaky and high-risk investment without your knowledge. You later find out that it was a no-return investment, and you lose all your retirement money. A mis-sold pension can happen to anyone, and it can throw you into severe financial difficulty. The good part is that you can always make a compensation claim against the person who misled you. If you suspect that you have a mis-sold pension, below are the signs you should look out for.

The financial adviser is not an expert, after all.

Many rogue financial advisors out there don't possess the necessary qualifications to give financial advice. If you are taking financial advice from unqualified personnel, more so on your retirement plan, you should be on a worrying end. Before you open up to any financial advisor, ensure they hold a degree or a relevant qualification in finance, economics, law, management, or mathematics. Anything other than that should give you a reason to reconsider.

It is also advisable that you check if the person has passed any trainee exams offered by their company and look for pension regulatory bodies' qualifications. That way, you will be at peace knowing that you're dealing with an expert who will do due diligence before giving you any form of financial advice. If you took a pension product on the recommendation of someone who is not a qualified financial advisor, start your research on whether it is a mis-sold pension. If it is, you can initiate a legal claim.

The financial advisor hasn't explained the terms and conditions.

It is the responsibility of a financial advisor to explain a pension product's terms and conditions before you invest. You are giving them your trust with your retirement money, and as such, they should inform you of the terms before you make an investment choice. Also, ensure you are informed before you make a decision. If your instincts tell you that your advisor is somehow withholding some information from you, you should do your research about mis-sold pensions. If you have already invested and the advisor failed to give you the complete information, then you have the grounds to make a compensation claim.

They did not inform you of certain pension charges or premium payments.

In addition to the point above, if you were not made aware of certain pension charges, then you may have been mis-sold pension. What makes this dangerous is that you may end up paying more than you earn in your pension investment. If the advisor did not inform you of particular pension fees, you have a right to hold them accountable.

You were misled to move your pension from a workplace pension.

A workplace pension is safe, and it comes with extra benefits. These are guaranteed savings that do not have any risks at all. Here comes an advisor who misleads you to transferring the workplace pension to another alternative investment, which is risky. In many cases, such a transfer results in no benefits to you financially. If you have encountered such a situation, high chances are you have been mis-sold pension.

You were duped into more financial risks than you were prepared for

Usually, it involves a discussion and agreement between you and your financial advisor to settle on a financial risk you can afford or comfortable with. There must be that level of communication. If it is lacking, you might have a mis-sold pension. You must settle for a pension product you are comfortable with, and you have agreed to the financial risks involved. However, if you are in such a situation, you are eligible to make a compensation claim.

The bottom line

Generally, if you suspect that you have a mis-sold pension, you should seek advice from mis-sold pension claims experts who can help you determine that. Again, they also help you determine the liable party and make a compensation claim if affected.