Many moons ago, when everyone had money and stock markets were going through the roof, members of our beloved financial services industry were themselves advised that traditional final salary schemes were unlikely to equal the returns offered by stock market-linked private pension schemes and were urged to offer pension transfer advice to members of the older schemes .
However, the old schemes had cast-iron guarantees and the new schemes had none. We all know that stock markets fall as well as rise, so caution all round was the watchword of the day, certainly for us here at Jones Hill.
Not only are final salary schemes inherently stronger, but certain public sector schemes even outclass the private final salary schemes, not least those offered to our Armed Services.
Regular readers will know that I keep a high horse, fed and fully tacked for special occasions, and now it’s time for me to take it for another gallop. Why? Because once again the notorious Ex-Armed Forces Pension Specialists are seeking to drag members of our armed forces from the security of their schemes into something reliant upon stock market performance.
Now, it’s fair to recognise that public sector schemes are undergoing change. The media is adept at finding the darkest of scenarios to paint for its consumers and there is unrest within the employee population. Nevertheless, preying upon individual insecurities is an ethically dubious way of conducting business, and our armed forces have enough minefields to deal with as it is.
The Ex-AFPS targets retiring or retired members of the Armed Forces Pension Scheme and its name may fool you into thinking they’re the same thing. In fact, they are a part of Caledonian International Associates, a company based in Chile and whose advice policy seems linked with Garda World, an international risk management group with an office in London, but based principally in Dubai.
Ex-AFPS declares correctly that it is not authorised to give advice, but acts as introducer to other, unspecified companies, presumably Caledonian and Garda. If alarm bells aren’t yet ringing I have a bridge in London I’d like to sell you.
Whether or not you are a member of the armed forces or any other final salary scheme, you should take advice from an independent financial adviser, regulated and based in the UK.
Whilst Caledonian and Garda have a nominal UK presence, and presumably could prove UK registration, I would steer clear of any group using scare tactics to drive you towards any decision that you may have your entire retirement to regret. I would be particularly sceptical of any business which sets up a separate company to deal in an area which courts so much controversy, and which could be dissolved at the first sign of trouble.
I put my concerns directly to the man in charge of Ex-AFPS, who promised to make changes and clarify the situation. To date, nothing has happened. Draw your own conclusions.
Brian Hill
Top 200 UK rated IFA
01225 775923
