The Advantages of Professional Financial Advice

Retirement can be a time to indulge yourself if you plan it well in advance.

Travel to a dream destination; learn a skill that you always wanted to or fulfil other wishes that you never got time to attend to.

However, you still have one important decision to make. In fact, it may well be the single most crucial decision that you will make for the rest of your life.

What should you do with your pension pot that you have accumulated after years of working hard and making sacrifices?

Decisions regarding retirement income were always a complex one. It has become all the more complex after the new pension freedom rules came into effect in April 2015.

If you are at that juncture in life and are unsure about which way to go, then it’s time to seek professional financial advice.

Why You Must Get Help

You will have to decide how you are going to use your pension pot. And there are a lot of different options. Some are simple, others are complex. But not all of them will suit your financial circumstances and your attitude to risk.

To add to this, there are many questions which you need to answer to be able to make the right decision.

Do you know what questions to ask?

Further, do you know what option to choose if you get the answers to these questions?

  • There are more options than ever. You can take larger sums in cash or choose to invest outside the pension. Some of these choices may be risky if you are not too careful with it.
  • If you are not aware of all your options, you may well buy a poor value annuity which may leave you with a much lower income than what you are eligible for.
  • If you choose to leave your money as cash, you may receive dismal interest rates and may not maximize its complete potential
  • There are a large number of fraudsters who are out to make a quick buck via Pension scams. Most of them will try to take advantage of the ‘Knowledge-Gap’ that people have about the radical changes to the pension rules.

These are, of course, just some of the reasons why you must seek professional help. The most important reason is that you must be able to receive an income during your retirement years that will provide you with the kind of lifestyle that you wish for.

Free Professional Advice

The government now provides free financial guidance for retirees through the Pension Wise service. It is run by professional financial experts and volunteers who have considerable expertise and skill handling complex issues pertaining to pensions.

There are multiple ways to reach Pension Wise.

  • You can schedule a face-to-face appointment with them by calling on 0300 123 1047.
  • You can log on to their website and use their web chat function to speak to a financial expert
  • You can also call them on the above number and schedule a telephonic guidance session

While the pension wise service can be used as a good starting point that will be informative, it cannot be considered enough.

Read our post on Understanding Pension Wise.

A professional financial advice will be a paid service. Advisers are bound by a code to reveal to you beforehand what the service will cost and what advice will be covered.

According to the Association of Professional Financial Advisers (APFA), the average cost of professional advice will be around £150 an hour.

Is this cost justified or are you better off buying what your pension provider is offering you?

Think about it this way. If you spend this money now, you will receive sound professional advice that is tailored to meet your financial objectives and to match your personal circumstances.

Also, the financial advisor will ensure that they will clarify the pros and cons of each option that you have.

The ideal time to speak to a financial advisor is at least six months before you retire.

Are you looking for a professional financial advisor? Read our article, ‘How to Select a Financial Advisor’ for more information.


Understanding Pension Wise

As per the new Pension Freedom reforms that were introduced in April 2015, savers now have more flexibility in the way they access the funds in their pension pot.

There are multiple options and choices when it comes to maximizing tax benefits.

Are you aware of all the choices you have?

Do you know how the new pension reforms can benefit you?

If you don’t, then now is the right time to head straight to Pension Wise.

What is Pension Wise? 

On the 21st of July 2014, the Chancellor of the Exchequer, George Osborne announced that millions of UK citizens would now have the right to impartial guidance on how to utilize their pension pots after the new Pension freedom laws come into effect.

Following this announcement, the Pension Wise service was launched in Feb 2015.

Pension Wise is a completely free service backed by the government and manned by independent financial experts who will guide retirees on making the right decisions regarding their pension funds.

There are multiple ways in which Pension Wise can assist you.

  • The Pension Wise Website is a comprehensive source of information regarding retirement finances. You can get detailed information about pensions, your choices and the tax implications of making those choices.
  • You can schedule a face-to-face appointment to further discuss these choices ensuring that you are well informed and aware of the decisions you make.
  • You can call them on 0300 123 1047 or use their web chat function to speak to a Financial Expert who will provide consultation on your doubts regarding pensions.

Benefits of using Pension Wise

If you are not fully aware of how the new Pension Freedom reforms would affect you, then it is better to seek impartial advice.

And there is no better place to get impartial advice than a government-backed agency.

It is free and it can help you in more ways than just provide information.

Disputes: Pension Wise can act as a mediator if you are involved in a dispute with a pension provider (Public or private) and have already tried to resolve the matter by writing to them. All you have to do is furbish copies of the initial correspondence you had with the scheme. The in-house pension specialists will then guide you through the best possible course of action.

Telephonic Guidance: As long as you are above the age of 50 and have a defined contribution pension plan, you can call Pension Wise on 0300 330 1001 between 8 am to 10 pm every day to schedule an appointment or a telephonic guidance session. You can also walk into the nearest Local Citizens Advice Bureau to schedule an appointment.

Impartial Advice: Unlike pension scheme managers who may try to sneak in a sales pitch between advice, the pension experts at Pension Wise will give you unbiased advice without recommending any service or product.

Scams: Since many people are unaware of how the new pension freedom norms would affect them, fraudsters are having a ball. There are many types of pension scams which target retirees. If you have received an offer for a free pension review or an overseas investment option in an ‘exotic’ location, then it may well be a scam. You can speak to the financial experts at Pension Wise before deciding on any further course of action. You may also check our article on how to Identify a Pension Scammer.

Prepare for your consultation

If you have booked a phone guidance session or have scheduled a face-to-face appointment with Pension Wise, then you must be prepared with some information for the appointment.

  1. Get the latest pension statement from your provider to know the value of your pension pot(s).
  2. Analyze your current financial situation and keep the details handy. You may need to discuss your current salary, your cost of living during retirement and whether you have additional savings or debts.
  3. Decide on how you wish to access the Pension Pot. Do you prefer a fixed monthly income or are you better off accessing small sums of money from the pot?
  4. Do you have any health conditions that may affect your life expectancy?

Remember, good advice is only a phone call away. Make use of it.