Research commissioned by LV= reveals that the source of the Government’s proposed guidance service will make a significant difference in terms of consumer take-up.
According to research commissioned by LV= 78% of Britain’s over-55’s are in favour of those approaching retirement having access to free guidance to ensure that they make the most of their pension savings. However, although 52% of over-55s say that they would attend a guidance session provided by an independent, government-backed, consumer body, only 17% would attend a guidance session offered by their existing pension provider when asked to choose between the two.
The research highlights the fact that consumers are more likely to trust and act on retirement guidance provided by an independent body than that provided by their existing pension provider. Less than a fifth (19%) of over-55s say that they would act on guidance provided to them by their pension provider, whereas close to half (48%) would act on guidance from an independent body.
Industry figures indicate that just a fifth of Brits have sought the services of an independent financial adviser. Yet, LV=’s research found that, of those approaching retirement, only 9% say that they would be unlikely to seek regulated financial advice if it was recommended to them in a guidance session.
Richard Rowney, managing director of LV= Life and Pensions, said: “Those approaching retirement will have even greater choice as to how they take their pension savings from April 2015 and it is important that they are made aware of all the options available to them.
“The findings of this research support the widely held view that, for the guidance to be a success, those approaching retirement need to have trust in the process and the organisation offering the service. It is clear from our research that, in order for this to be achieved, the sessions should be provided by an independent body.
“LV= is committed to improving outcomes for those approaching retirement and in our response to the HMT ‘Freedom and Choice in Pensions’ consultation we have outlined the changes that we believe need to be made to achieve this.”