Money alert: Pension liberation

 

There were fresh warnings this week of the dangers of pension liberation – schemes which offer people the chance to transfer their retirement savings to an arrangement that allows them to get at their pension pot before the standard retirement age of 55.

The Financial Conduct Authority said on Monday that HM Revenue & Customs is poised to take action against a large number of “dubious” pension schemes. The problem is simple: most people targeted by these companies with the temptation of using a “legal loophole” will end up worse off. “Any unsolicited approach should be viewed with suspicion,” warned Chris Netiatis of lawyers Pitmans. “There are very limited exceptions, which include terminal illness, where there is medical evidence that the member's life expectancy is less than one year,” he added.

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