Meet Brian & Elena – We All Make Mistakes, Sometimes, They Lead to Success

Mistakes in finance

This story is all about Brian and Elena who I’ve looked after since my early days as a Financial Advisor, when I started back in 1990.  Initially, we’d met and completed some financial transactions but at the time, Brian and Elena didn’t get involved in financial planning.  They were very nice, down-to-earth types, Brian was a security guard, and I enjoyed their company but didn’t meet up with them very often.

Don’t Be Taken In By Fancy Cars and Expensive Watches!

Years later in 2017, I received a call from Brian out of the blue.  He was in a panic!  Only a year before in 2016, he’d been persuaded to transfer his final salary pension to a personal pension by a smooth-talking salesman in a smart suit who’d come to his place of work and persuaded lots of the company’s employees to transfer their defined benefit schemes to personal pensions.  I’ve seen this type of salesman before.  They turn up looking suave, wearing a Rolex watch, and driving a fancy car – then they talk the talk.  They transfer a hundred clients over to different pensions, take commission (fees) of up to £10k a time and then disappear with their ill-gotten gains leaving everyone else to pick up the pieces.  Brian was very concerned that he’d done the wrong thing and we talked it through.  In fact, I was amazed to hear that the company had even sent a courier motorbike on a hundred-mile round trip to collect signatures on the same day he’d visited the office!

Non-regulated Off-shore Funds

So, it was over to me. I agreed to investigate what Brian had done for a small fee.  I obtained Brian’s letters of authority to approach the advice firm and the pension company.   Well, I wasn’t at all surprised to hear that the so-called “advice” firm had gone into liquidation and therefore was no longer in existence. However while this was not a surprise – I then received details about the pension, and I was horrified to discover that a significant portion of Brian’s pension had been invested in non-regulated offshore funds.

I immediately suggested that Brian transfer his pension to the platform where he already held investments through us but then we hit a brick wall because the unregulated funds couldn’t be transferred because they had no real value. When an advice firm is no longer in existence, the only recourse is to put in a claim to the Financial Ombudsmen Service.  So, for the next two years, I managed all the paperwork for him in order to submit his claim.  It’s worth bearing in mind that the FOS has a maximum pay-out of £50,000 in cases like this.  While Brian didn’t get his full amount, he was happy because he thought he’d “lost the lot”.  We managed to recoup something, which is always better than nothing!

Always Be Cautious!

Unfortunately, I have seen cases like Brian’s before.  It always amazes me how someone as cautious as a security guard could be so vulnerable when presented with a slick presentation.  I’m a jeans and tee-shirt man myself.  It might not be the “accepted” business attire, but at least you can see who I am and not risk being taken in by fancy clothes!

Since then, as you might expect, Brian and Elena have become keen financial planning clients and they no longer make any financial decision without consulting me first!  They’re now invested in a personalised portfolio of sustainable funds, their life-time cash flow shows they can do whatever they want to do in retirement and their estate planning is complete.  With my team and my ongoing support and regular reviews, they can look forward to a financially healthy retirement.

We All Make Mistakes!

I rate Brian as one of my successful clients because we all make mistakes in life and he had the sense to realise that he had made a mistake, owned up to it and found someone to help him sort it out.  You only fail if you continue to make the same mistake and Brian will never make this type of mistake again.

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