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The Free Standing Additional Voluntary Contribution (FSAVC) pension is a separate pension from an employer pension and one that is designed to offer additional saving capacity for retirement. Unfortunately, many of these pensions have been mis-sold and this has resulted in high charges and loss of value for plan holders. If you were sold an FSAVC pension then there is a possibility that you may have been mis-sold the pension and could be entitled to compensation as a result.

What kind of pension do I have?

The first step to establish whether there has been any mis-selling is to identify the type of pension that you have. An FSAVC pension is different from an employer or workplace pension. It’s a product for saving for retirement and one that can be used in addition to a basic pension from an employer. If you’re not sure whether you have an FSAVC pension – or the pension has already paid out or you don’t have any paperwork – it’s still worth enquiring whether you might be affected by this mis-selling, as there are ways of finding out. Some of the key differences between an FSAVC pension and an employer AVC pension include that the employer pension will be more secure, as it is tied to your career, and is likely to have lower costs. If you do establish that you have an FSAVC pension the next step is to look into mis-selling.

How do I know if I was mis-sold an FSAVC pension?

If you have an FSAVC pension then there is a possibility that it was mis-sold, as the way that many of these pensions were arranged was not beneficial for plan holders. This was especially so due to the high charges often involved. If you want to establish if you were mis-sold an FSAVC pension then these are some of the signs:

• You weren’t offered an alternative to the FSAVC pension. There are many different ways to save for retirement and make additional contributions to your pension. An FSAVC pension is not the only option and may also not have been the most beneficial for your situation. To avoid mis-selling it’s essential that an advisor gave you information about all your options, not just the FSAVC pension.
• There was no information about the poor flexibility of the FSAVC pension. High transfer penalties apply to FSAVC pensions and this has meant that there is no option for many consumers to transfer the policy. If these high fees were not raised at all during the process of selling the FSAVC pension then it may have been mis-sold.
• FSAVC is a portable pension product – did you actually need it? If you were planning to stay with an existing employer then there would have been no need for you to have a FSAVC, which is designed to be a portable pension product. Where that’s the case then the FSAVC would not have been the right choice and was probably mis-sold.
• Your risk attitude wasn’t considered. An FSAVC pension can deliver a high return but this comes with an increased risk. An advisor should have assessed whether your attitude to risk was aligned with the FSAVC and if they did not then the pension could have been mis-sold.

A mis-sold FSAVC pension could entitle you to compensation so it’s vital to find out whether this has happened to you.