The government’s pensions guidance service is finally up and running. That’s crucial as the new pension freedoms that allow you to do what you like with your retirement savings are just under two weeks away.
The Chancellor announced during a Treasury Select Committee session on the Budget that the phone lines for the official Pensions Wise service are now talking calls. “People can now book their appointments to have a conversation about what they might want to do with their pension,” George Osborne said.
It’s an important conversation. The opportunity to cash in their pension has been given to all those aged 55 and over and, while it’s a very tempting offer, anyone rushing to do so could regret that decision for the rest of their life.
Why? Because we are all living longer and if we want to enjoy the golden years rather than spend them running for the shadows, then we’ll need plenty of cash.
The state pension will be inadequate for most people to have a decent standard of living when they retire, so any savings they have could be crucial in making a difference between a decent life, or struggling in penury in your 70s and beyond.
There’s a huge risk that up to five million people could make a hasty decision about their pension pot. The City Watchdog is aware of the dangers and admitted that faced with “the most fundamental changes to pension policy we have seen in over a generation” it will be forced to spend much of the next few months closely examining pension companies and how they deal with their customers.
Boss Martin Wheatley said: “We will be looking at how the market is working and in particular, how the industry is adapting to this considerable change and what it means for consumers.”
If you’re affected, I’d urge you to book an appointment to use the government’s Pension Wise guidance service and get some face-to-face advice. Call 030 0330 1001 to book an appointment, but expect to wait two weeks or more as demand will be heavy.