With-profits funds
Have you been mis-sold a with-profits investment?
With-profits funds are relied upon by millions of UK investors
to provide for their future wellbeing. With-profits funds are
low-risk investments that "guarantee" a good pay out in the bad
years by holding back a portion of the profits from the better
years - a process known as "smoothing".
Many people have reaped the benefits of with-profits funds and
use their returns to fund such things as retirement, their
children's education or to pay off their mortgage.
However, in the past few years, investors in with-profits funds
have seen their bonuses dwindle dramatically, even
in the good years. In fact, many would have seen a higher rate of
return if they had simply left their money in a regular savings
account.
In addition, those who try to withdraw their investment from
underperforming with-profits funds find themselves stung by
extortionate exit fees - known as Market Value
Adjusters (MVAs). These can often be up to 15% of the original
investment, meaning that £1000s can be lost as a result.
The majority of complaints about with-profits funds involve MVAs
and the fact that the firm who sold the policy did not make it
clear what would happen if the policy was cashed in early.
Many people say that they would not have invested had they
known about all the hidden costs and charges, as well as
the risks, of with-profits funds.
The Financial Ombudsman Service (FOS), which deals with
with-profits funds complaints, regularly uphold complaints where
they find the investor lost out as a result of bad advice or was
not given sufficient information about MVAs.
So if you have found that your with-profits investment has been
more without-profits then you may be eligible for
compensation. Please read on to find out how to make a with-profits
funds complaint.
How to
make a with-profits funds complaint
Claims Financial