Many of us put off assessing our pensions, either because they seem too complicated, or because we’re too busy focusing on other things. The good news is that there is a wealth of expert help available if you’re not sure how much you should be saving and where, or what to do with your pension when you retire.
If you are over 55, you can get free guidance from the government service Pension Wise. The service supplies help over the phone or face to face, with everyone entitled to one free session on what they can do with their pension pot, how to shop around, and what to look out for with fees and taxes. However, if you need advice and recommendations that are specifically tailored to your individual circumstances, you’ll need help from a professional financial adviser.
Why get Pension Advice?
One of the main problems with pensions is that lots of us start paying into pension plans when we’re younger, but then fail to check on how our retirement savings are doing.
David Hancock, a pension adviser at, says: “If your pension was taken out with a financial adviser in the 1980s or 90s from a bank and that bank now no longer provides advice, nobody’s going to contact you to give you continuing reviews. Pensions are often viewed as being so far in the future that people often forget about them, particularly if no-one is actively there to help them and give them continuing support.
Pension Advice Matters
Getting an adviser to review your retirement savings and investigate whether making changes could improve your pension could make a big difference to the amount you end up with at retirement.
“Consolidation is a massive factor, so if they have more than 1 pension they might find it simpler to manage them if they’re all transferred into the same pot.”
Transferring your pension may also reduce the amount you pay in charges. Pension charges have changed over time, so pensions tend to be cheaper nowadays and people can usually save money by moving them into a different plan.
In addition, lots of older pensions are closed plans, so customers are unable to make contributions. Switching to another plan may enable you to top up your retirement savings so that eventually you may end up with a bigger pension pot at retirement.
Of course, there will be some cases when transferring a pension may not be appropriate, for example, if you have a final salary scheme, and would lose out on a guaranteed level of pension in the future. Some pensions may also charge high exit penalties which may outweigh the benefits of transferring, which is why seeking professional advice is so important.
An adviser can also discuss your options at retirement, and the best ways to receive an income from your pension. When we explain to them what the new options are, most people decide to go for a pension which offers these because it puts them back in control of precisely when and how much they take.