Pension scam victims are losing £91,000 on average, according to he Financial Conduct Authority (FCA) and the Pensions Regulator.
Now a number of ‘red light’ words used by those behind a scam used to entrap vulnerable Britons have been revealed.
Pensions advice specialists, Portafina, have offered their tips on how to avoid scams and check legitimacy.
This includes watching out for these ‘red light’ words.
The experts said: “Lots of pension terms are unfamiliar, and most of us are used to accepting some jargon, (though we probably shouldn’t).
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“Some terms, though, are very likely to cause trouble when relating to pensions.”
Pension scam warning words
- Pension liberation
- Cashback
- One-off investment
- Limited time offers
- Loophole
How else can you check to ensure you aren’t falling into the trap of an unscrupulous scammer?
Check if they’re registered and authorised by the FCA
The number one way to check if you are being scammed is to check the FCA register and see if the company or individual is regulated.
Checking this database is the clearest and best way to see if a financial company or individual is regulated or not.
You can easily do this by searching the company or adviser’s name on the database and checking they are listed and their information matches what is on the register.
Avoid anyone who promises ‘guaranteed returns’
A company promising ‘guaranteed returns’ is likely to be a scam. The investments may be overseas where there is no consumer protection and typically promise a high guaranteed rate of return.
Very few things in life are absolutely guaranteed, and that’s especially true of investments. If it looks too good to be true, it probably is.
The experts add that you should be wary if anyone offers you the opportunity to access your pension before you are 55.
It says: “You can’t access your pension before you are 55 without facing a huge tax bill, except for a few very specific circumstances such as terminal illness.”
What is UK state pension age? Will it rise again?
State pension age depends on when you were born, so it’s worth using this government tool in order to find out.
In order to calculate your state pension age, you’ll need to provide your date of birth, as well as your sex.