Study reveals £37k advice boost for pensions
More on Companies & People
- Ros speaks out and DWP tinkers: week in news
- New lender launches into mortgage market
- Momentum Pensions launches Sipp for smaller pots
In focus: Future of Independence
A new report from Unbiased.co.uk and product provider Standard Life reveals that consumers taking pension advice are saving in excess of one third more for retirement than those who have not and are likely to retire with more than £37,000 more in their pension pot.
The report shows the current average pension pot for consumers who have been advised on their retirement planning is £74,554.30, double the average £37,277.10 of those not seeking advice.
Those who have not taken advice think that people should be putting away on average 9 per cent of their total salary according to the study, compared to the advised group who think people should be aiming for 11.4 per cent.
Those who have taken advice put nearly a third more a month - £167 compared to £108 - into their pension plan.
Based on a 54-year old, the average age of pension savers surveyed, this could mean the difference between getting a £493 a month retirement income when advice is taken versus £261 a month for non-advised individuals.
The figures, which form part of unbiased.co.uk and Standard Life’s ‘value of advice’ campaign, compare the differences in pension savings and contributions between consumers who have taken independent financial advice on their retirement provision and those who haven’t.
In order to produce comparable results, the research has been based on consumers with an average gross household income of £15,000 or more. Some 2,011 adults participated in the study.
Karen Barrett, chief executive of Unbiased.co.uk, said: “It’s vital to get the message across to consumers that when they are planning their finances, taking independent financial advice is something almost everyone should consider.
“For the majority, independent financial advice is within their means and can provide peace of mind.
“In the lead up to the implementation of the Retail Distribution Review, we are seeing greater emphasis placed on the advice process and the value it adds, but while the advice industry is undergoing numerous changes the RDR ‘tag’ bears no meaning to consumers.
“It’s our aim to tackle the misconception that financial advice is free - it has never been free and like other forms of professional advice - solicitor, accountant - we need to clearly demonstrate that the service IFAs provide comes at a cost but, as our research shows, one that is well worth paying for.”