QROPS salesman forget the customer in scramble for fees

Many QROPS salesmen seem to be forgetting the customer in the scramble for fees and commissions.

All independent financial advisors should know that the outcome everyone wants is beast advice for the customer.

A tried and tested way of providing this advice is to know the customer by finding out their personal financial goals, adversity to risk in investments and essential information like their tax status.

With this advice, the IFA then searches the expat pension market for the most suitable products – generally a qualifying recognised overseas pension (QROPS), although some other options are available under certain circumstances.

The customer then discusses the pros and cons of each product to put together a bespoke expat pension – choosing a financial centre and agreeing the finer details of the scheme.

Best QROPS advice

In recent weeks, we have seen a melee of firms pushing QROPS jurisdictions as places to invest for expats – but this is putting the cart before the horse.

How can someone know which is best for them before they have looked at how their personal financial circumstances affect the decision?

Best advice is if a pension salesman says you need a Malta or Swiss QROPS before discussing your financial affairs, walk straight out of the meeting, because the salesman is after commission or fees and does not have your best interests at heart.

The QROPS flavours of the moment are Malta, Gibraltar, New Zealand and the Isle of Man, with a smattering of Switzerland.

QROPS expat pension facts

The reality is the choice between them is wafer thin because HM Revenue & Customs has imposed a QROPS blueprint that every provider must follow.

Forget the smoke and mirrors about the number of double tax agreements, whether the financial centre is in the European Union or the fact they may speak English. It’s all sales speak nonsense.

“Until recently, Cyprus fulfilled all those criteria – and was unceremoniously dumped by HMRC has a QROPS jurisdiction without reason” says Chris Wright from Qrops Investor

The best IFAs are whole-of-the-market advisers who can choose from any of the estimated 2,500 QROPS expat pensions offered in about 50 countries.

Like any other investment, QROPS expat pension savers need to keep an eye on fund and administration charges, control of their money and to have confidence in their provider.