Three things have upset me this week.
Firstly, I was told about someone losing £20,000 to a telephone scammer pretending to be her bank. Secondly, one survey revealed that less than 50% of the population would seek financial advice and thirdly, a survey by the Citizens Advice Bureau revealed that pension scams are on the increase with cold telephone calls on pensions taking over from PPI.
Now we can’t do anything about the bank scam. If you release details of passwords or PIN numbers to anyone, despite the TV adverts and literature from banks warning you not to, then it is your loss, simply do not do it. The other two in my mind must be connected.
The excellent survey by the Citizens Advice Bureau, on over 2,000 people found that despite 75% of them being confident they would spot a scam, almost 9 out of ten, when faced with three adverts (two scams, one genuine,) chose one of the scams. The two fake adverts offered high growth rates and free advice whilst the genuine one spoke of realistic returns and fees.
There are four main pension scams, accessing your fund under age 55, high investment returns often in offshore investments, a “free” review, and “free” advice.
Pension funds cannot be accessed by law under the age of 55. There are exceptional circumstances which are exceedingly rare but if anyone offers you the chance to get access to your funds it is a scam. It is also very expensive as not only could you lose your entire pension fund but you could get a tax bill of 55% of the money you have lost as a penalty for not obeying the law.
If you are tempted by offers of high investment returns in say Brazilian rainforest property for example, just stop and think why you should be offered this wonderful opportunity? All the scammers are trying to do is get your pension fund transferred to an unauthorised account normally offshore so they can get their hands on it.
Free reviews and free advice? All advisers in the UK are liable for the advice they give and must charge fees. Being authorised to advise and liable for that advice in future involves cost, so how can anybody legitimately offer “free” services? These are simply scams to soften you up ready for the big scam when they want access to your funds.
If you are thinking of moving your pension funds The Financial Conduct Authority has a helpful website; scamsmart.fca.org.uk to check before you invest but I have one for local folk. If you have not had advice from your own IFA about the potential move contact them immediately or call and see us if you don’t have one.
If the thought of paying reasonable fees puts you off just think what it would feel like to lose your entire pension fund!
Fee increase for Bereaved Families
month we looked at probate, explaining that this is the term used to
describe the administration of someone’s affairs after their death.
In this article we look at the Grant of Probate in more detail.
If you have made a will you will be familiar with the concept of an executor – a person nominated in your will to deal with your affairs. Your executors can be individuals or a firm of solicitors. Whoever you nominate, they usually need to apply for a Grant of Probate – a document issued by the Court giving authority to deal with the assets and make distributions. The application must be accompanied with a tax declaration and the will, along with any codicils – a codicil is a document that amends the original will.
There is a fee payable for the issue of a Grant of Probate. At present a flat fee of £215 applies to applications from individuals and £155 to applications made by a solicitor. This fee is for all estates, other than those valued at under £5,000, in which case no fee applies. However, the Government is undergoing a consultation period on substantial increases to these costs.
The Government is proposing a sliding scale of fees. Under the new rules, an estate worth under £50,000 will not attract a fee but current property prices easily dwarf that sum. In fact, The Telegraph reported last December that average house prices had hit £300,000, and growth was led by the East of the country. If your estate was valued at £300,000 the Grant of Probate fee would be £1,000 and if you had an estate worth £500,000, that fee would increase to £4,000. For the very rich, an estate valued at £2m would attract a huge fee of £20,000!
The Government is seeking to raise £250m a year to help towards its £700m target spend on reform of Her Majesty’s Courts & Tribunal Service, but the question has to be asked as to whether it is fair that bereaved families should pay to maintain the whole court structure, including criminal courts.
These changes are not yet law and we will keep you updated.
meantime, if someone you love has died and you need help with the
administration of their affairs, or you want to make plans for your family’s
future security, contact Joanna Millican on 01206 217360 or