If you’ve recently retired abroad in the United States, your Independent Financial Adviser may have stopped talking to you. But don’t get your feelings hurt; he’s just following the law.
The Catch-22 of UK Pension Advising
Believe it or not, Independent Financial Advisers (IFAs) in the UK are not allowed to advise you on your pensions and pension transfers (or anything else for that matter) once you’ve become a US resident. It’s not a matter of overseas phone charges; it’s simply the result of regulatory measures taken by the Financial Services Authority (FSA) and the rest of the British pension industry.
Call it what you will, but the end result is the same: British expats residing in the US need to find advisers who are qualified to advise them under the law.
And just in case you thought you could skirt the issue by talking directly to your pension provider, that’s not possible either. The FSA has that end of things locked down as well!
Providers are not permitted to deal directly with pension holders. They may only deal with Independent Financial Advisers who are, of course, regulated through and in the UK.
Why Can’t Your Former IFA Help You?
Once you move to the United States, your personal finances change. The laws governing your pension are complex even when you remain in the UK, but becoming an expat really scrambles things around as far as laws, regulations, and your options are concerned. The tax implications alone are mind-boggling.
As an expat, your savings are now affected by U.S. institutions, namely the Security Exchange Commission (SEC). And once the SEC gets involved, a whole new set of regulatory issues enter the picture. In essence, your former UK-based adviser simply isn’t equipped to advise you under this new set of circumstances.
So, if your pension provider will only talk to a UK-based IFA, and if UK-based IFA’s can’t advise you because you now reside in the U.S., who can you talk to about pension advice?
The worst possible scenario is for expats to seek financial advice from unregulated, uneducated, unethical scammers posing as bona-fide advisers. Since the freeing up of UK pension laws in 2015, some scammers have stepped up to try and lure UK pensioners into investing in dangerous, risky schemes that aren’t set up to benefit them at all.
Filling the Gap: A US-Based UK Pension Expert
The best possible scenario is to find a UK adviser who has decades of experience advising in the UK pension area, but who has since moved overseas himself and become authorized under the SEC to advise British expats.
Luckily for British expats residing in the U.S.A., there are UK pension experts who can legally give advice on how to handle pension transfers and the like.
The United States has its own fair share of confusing regulations for financial advising. At last count, there were over 100 different financial designations for advisers! And some simply hang out a shingle and call themselves financial advisers, possessing no training or experience at all! As you may have already found out, the financial advising system in the United States is self-regulated, and therefore, very tricky to navigate.
Our very own Tim Carroll is not only a veteran of the UK personal finance industry; he’s also licensed as an Investment Adviser in the State of Georgia and regulated by the SEC under the Uniform Securities Act.
If you have questions about your UK pension while living in the United States, Tim Carroll is fully authorised and qualified to advise you. He offers a free pension review. Call for yours and find out all your options from a trusted, knowledgeable source.