Employees making financial decisions alone, finds Stuart Stone
Only 8% of people currently speak to an adviser about financial decisions, according to a survey from Aegon UK – with nearly half of respondents admitting they make decisions alone.
These figures are concerning given a 2015 study by OnePoll revealed that just 14% of people are confident about independent financial planning, with one in five respondents admitting they’re uncomfortable deciding how to access their pension independently.
Steve Cameron, Aegon’s pensions director said: “The low take-up of financial advice is very worrying. Greater personal responsibility for retirement planning combined with increased levels of economic and political uncertainty, mean people need professional financial advice more than ever.”
He added: “People shouldn’t feel they have to make financial decisions on their own. For some people, the support they need may be relatively simple and there are free sources of guidance available, for example from Pension Wise on pension freedoms. Providers and possibly their employers can also provide basic information.”
On the subject of pensions, Aegon listed seven reasons to speak to a financial adviser when planning for retirement.
- Selecting a pension product
- Planning your retirement goals and where to invest your money to meet them
- Deciding how to access your pension
- Consolidating your pension saving into one pot
- Transferring a pension from one provider to another
- Reviewing investment performance or changing funds
- Inheritance tax planning
Cameron added: “For the more important and difficult decisions people should seriously consider paying for financial advice and in many cases, the benefits of getting things right can far outweigh the costs.”
Blogging with Reward, WEALTH at work, a leading provider of financial education in the workplace, supported by guidance and advice, has given ten top tips for what employees retiring in 2017 should be thinking about.
Jonathan Watts-Lay, WEALTH at work comments; “Getting financial advice can actually work out cheaper than no advice and provide added consumer protection. Many people are concerned about the cost of advice without realising that when they buy retirement products such as annuities, through for example online brokers, they are paying commission which can cost just as much, if not more, than getting advice. A financial adviser should look at all assets, work out the most tax efficient way for individuals to fund their retirement income, and put the plan into place for them; then individuals have the benefit of consumer protection for the advice given.”
Despite the Autumn Statement move to crack down on pension scammers, it is still fundamental that employees are aware of the dangers – and of their options – as they approach retirement.
Reward and WEALTH at work are blogging about financial education, savings and retirement options. FOLLOW THE SERIES HERE