There are concerns over the government’s pension guidance service. As moneymarketing.co.uk reports, there are worries the service could face collapse due to the high demand that it will face, and there are some concerns over the quality of information that people using the service will be given.
The government’s pension guidance guarantee was first announced in July 2014 by Chancellor George Osborne. Under the guarantee, individuals would be entitled to free, impartial advice on how to maximise the benefits of the new pension choices that come into force in April 2015.
The government predicted that up to 18,000,000 people would benefit from the new changes to pensions and it was announced that the advice given would be by independent organisations to enable people to benefit from the new flexibilities in the pension system.
“Two Tier Service”
However, there have been some anxieties expressed over the quality of information that people using the service will be offered; moneymarketing.co.uk highlight concerns that individuals could find themselves with a two tier service where individuals that get a face to face service will get a poorer deal compared with people using the phone option.
The worries have arisen because some agents won’t necessarily have experience in giving financial advice or have specialist experience in the pensions industry, and although advertisements for some of the roles state that knowledge of pensions is advantageous, it won’t be necessary for agents to have expertise in this area.
This has led to fears from industry leaders that some staff will not be knowledgeable enough to give the correct advice when it comes to discussing an individual’s pension options; the Treasury has explained that all staff will undergo extensive training, but financial experts say training won’t be enough and suggest advisors need to have a firm knowledge of pensions in order to give the best advice.
Independent Financial Advisor
Due to the demands that are likely to be placed on the new service, and the fact that advisors might not have extensive training in the financial industry, the best option for many people will be to seek out an Independent Financial Advisor with the years of experience and the background knowledge that will be necessary to enable an individual to make the best choices about their pensions.
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