You saved for decades so your retirement would feel steady. But you may be part of the unfortunate statistic that sees your money at risk because you were steered into mis-sold SIPPs.
Unlike standard schemes, SIPPs let you steer your money into everything from familiar funds to trickier assets like commercial property. While the flexibility can look attractive, countless savers are persuaded to move into SIPPs that aren’t suitable for them.
Industry estimates suggest thousands have been affected, with many people only realising the problem when losses start to show. Recognising the warning signs early could help you protect what you’ve built and even recover some of what you’ve lost. So, here are practical warning signs to watch for…
1. Lack of Proper Financial Advice
Many people are encouraged to transfer out of safe, traditional pensions into SIPPs by advisers who fail to explain the risks. For example, you might have been told a transfer “unlocks growth” but never shown how your retirement income could be affected.
A regulated adviser should compare the transfer against your existing pension(s), show projected income under different scenarios, and record why a transfer is suitable. If none of that happened, you probably weren't given regulated advice.
If the adviser failed to give clear, regulated advice, you may be able to pursue compensation for mis sold SIPP. It isn’t automatic, but poor or missing advice is often the first thing complaints focus on.
2. Being Pushed Toward High-Risk or Unregulated Investments
Some SIPPs put money into odd projects — off-plan overseas developments, storage-pod schemes, or commercial forestry, for example. Those assets often lack independent oversight, are hard to value because there aren’t easy comparables, and can be almost impossible to sell quickly if you need cash.
For example, property promoters sometimes promised steady rental income, but practical problems with occupancy, management, and resale wipe out returns. If most of your SIPP is tied up in anything like this, it’s a strong warning.
It doesn’t mean you were definitely mis-sold, but if the risks weren’t made clear when you signed up, you should investigate further. It's possible that the transfer was driven more by selling a deal than by matching an investment to your needs.
3. Promises of “Guaranteed” or Unrealistic Returns
“Guaranteed” high returns are a classic lure. Maybe someone told you your pension would double in a few years, or that the investment was risk-free. Real investments always carry risk. Any adviser claiming otherwise is either careless or misleading.
When you hear guarantees, ask for proof, independent valuations, and clear explanations of where the money will come from if returns don’t materialise. If answers are vague, treat that as a major warning sign.
4. High Fees and Hidden Charges
Fees are one of the quietest ways pensions lose value because of bad pension advice. Platform charges, annual management fees, exit penalties, and adviser commissions can add up. You might find that after a decade, the retirement pot is several thousand pounds smaller than it should be, sometimes without a clear reason.
Transparency matters. While fees are part of any investment, they should be clear and proportionate. If you weren't given a plain breakdown of all costs, or if charges were added later with little explanation, that might indicate the SIPP was not sold properly.
5. No Clear Understanding of Risks or Terms
Think back: did you leave the meeting confident you understood the risks? Many people don’t. They discover later that their investments are illiquid, or that promises in the sales pitch aren't reflected in the paperwork.
A genuine failure to explain the risks and terms strengthens mis sold pension claims in the UK. It’s not about blaming you; it’s about whether the adviser did their job. It’s the responsibility of the adviser to ensure you know the full picture before agreeing to the transfer.
6. Pressure Selling Tactics or Misleading Information
Pressure tactics are common. Some advisers use scare tactics, like warning you that you’d “miss out on an exclusive deal” unless you acted quickly. Others will give overly optimistic pitches that skip the risks.
Financial advisers must follow conduct rules, and hard-sell tactics and misleading claims don’t meet that standard. Real advice gives you time to consider the paperwork and clear, written explanations you can take away. If you’re hurried into a transfer or being sold “guaranteed” returns, pause, ask for everything in writing, and get a second opinion.
What To Do If You Suspect You’ve Been Mis-Sold
Begin by collecting paperwork. Look for the advice reports you received, details of investments inside your SIPP, and any fee structures. This evidence is vital.
Next, complain to the firm that gave the advice or ran the SIPP. They should respond within eight weeks. If you’re not happy with the company’s reply, you can escalate. For many advice or investment disputes, the Financial Ombudsman Service is the usual next step, and for trustee or pension-administration issues, the Pensions Ombudsman is the right place to look — both services are free to use. But act quickly — there are time limits (often six years from the mis-sold event, or three years from when you became aware of the problem).
If the provider has gone under, the Financial Services Compensation Scheme may cover some losses. In many pension investment failures, that can mean up to about £85,000 per person (rules and caps apply, so check your case).
These claims can be paperwork-heavy. Many people hire a specialist mis-sold pension lawyer to help gather evidence, draft submissions, and guide the process in the right direction. It’s possible to do it yourself, but professional help often makes the path clearer.
Conclusion
While SIPPs provide wide control over investments, that control has been used to conceal unsuitable advice and hard-to-sell assets. Treat any push toward unusual investments or hurried transfers as a red flag. If anything you read here resonates with you, act quickly by taking the necessary steps. Taking action now could protect what remains of your retirement savings and help you recover losses where that’s possible.
