Are the systems behind the Pension Freedom initiative failing? That’s the claim made by some experts after looking at the FCA‘s data from last year. In 2016, the majority of people who released money from their pension accessed the whole pot (not just a part of it). And there are claims that not enough of those people looked for guidance or advice from regulated Financial Advisors.
FT Adviser reports –
“Stephen Lowe, group communications director at Just, said the figures revealed “a failing system” in which not enough people were seeking either guidance or full regulated advice… He said: “We don’t know whether customers who have withdrawn their savings are receiving good value from the subsequent investments they have been making as a consequence of this one-time decision… “Behavioural economics shows that defaults work, seeing these figures it is getting harder to justify why Pension Wise is not the default option for all those looking to access their pensions benefits.” … LV’s head of policy Philip Brown agreed, saying the figures highlighted “the worryingly low number of people taking advice and exercising choice at retirement”… “It’s vital government and industry work together to make sure we support consumers and signpost them to advice so they can make informed decisions at such an important time in their lives,” he said… Aegon’s Steven Cameron focused on UFPLS, saying it was “worrying” that so few opting to go down this route were seeking advice.”