Majority back compulsory advice at retirement
Two-thirds of people aged 55 plus believe financial advice should be compulsory at retirement, according to new research published by retirement specialist MGM Advantage.
The study, which was conducted by ComRes among 1,000 UK residents aged 55 plus who are not retired, found more than one third of people (35 per cent) are not ‘comfortable’ managing their pension in retirement, while only 11 per cent are ‘very comfortable’.
Alongside this, the research showed that 62 per cent of people who plan to use their pension funds before retiring also think that financial advice should be compulsory.
Andrew Tully, pensions technical director at MGM Advantage, said: ‘The research paints a clear picture of an appetite among the over 55s for financial advice not only at the point of retiring but also during retirement.
“People are making difficult, life-changing decisions, made all the more complex by the new pension rules. We’re seeing the majority of people recognise that without financial advice they may fail to realise the full implications and make decisions that end up costing them dearly.”
Mr Tully added that the Pension Wise guidance service is a good starting point for people, and that the service can help people to understand the options available, but may not be good enough to help them make the choice that’s right for their personal circumstances.
He said: “We need to provide a clear hand-off to regulated financial advice to help people take the next logical steps. My fear is many people will revert to their pension company and not shop around for either the best solution or the best deal.
“We need to continue to work hard to promote the benefits of people actually taking the next step and getting proper regulated financial advice.
“This is the only way we can remove the status quo, ensure we improve the outcomes for people at-retirement and make sure the new rules benefit as many of them as possible.”
ruth.gillbe@ft.com
