Pension freedoms explained and how you could get expert financial guidance from Destination Retirement to make the best decisions for your savings and future
Image: Destination Retirement
Have you heard of the term ‘pension freedoms’? It’s the name of the recent changes that have removed restrictions on taking pension cash.
The policy was announced in 2015 by the then Chancellor George Osborne with the words: “Pensioners will have complete freedom to draw down as much or as little of their pension pot as they want, anytime they want.”
For the individual, this can be daunting, as they may not know the pros and cons of their choices. That’s where expert financial advice from Destination Retirement comes in.
Do you dream of financial freedom?
But before we talk about pension freedom, what does the phrase ‘financial freedom’ mean to you?
It probably conjures up ideas of having enough income or money saved to allow you to enjoy a comfortable lifestyle. Never having to worry about where you’ll find the cash to pay regular bills or sudden expenses.
Surely pension freedom is the same thing? Being able to access pension cash, as and when you want? Not quite.
Not everyone is celebrating the introduction of ‘pension freedoms’, and here’s why…
The short-term lure of cash pots
The first problem is that if people are focused on easy access to pension cash, they are less likely to hunt around for the best deal. That can mean people moving their pension savings to low-interest cash accounts, where their money doesn’t work as hard for them as it could elsewhere.
It’s your risk now
Another problem is that the responsibility for making decisions has shifted onto individuals. Many of these people are not actively engaged in their retirement savings plans. Or are simply unaware of the pros and cons of different choices.
This means that the key risks, once carried by pension schemes or pension companies, have also been shifted on to the individual. Risks that their money won’t grow in value, that inflation will make their money worth less over time, or that they may outlive their savings.
‘Pension freedoms’ were sold as the right to take pension cash when you feel like it
But true pension freedom – what people heading towards retirement really need to think about – is a bit different.
It’s the freedom that comes from knowing that the pension money you need to pay the bills will never stop or run out.
Help is at hand
To help people find their way through the pension maze, the Government introduced Pension Wise. It’s a free, impartial and independent pension guidance service. This is an important first point of contact for anyone thinking of accessing their pension cash, and it’s highly regarded by people who use it.
But for many people, there’s simply no substitute for expert financial advice that’s based on their own personal circumstances.
In the past, quality advice may have felt out of reach for a lot of people. This may be because they didn’t know where to find it, or simply because they couldn’t afford it. But the good news is that this is changing.
Introducing Destination Retirement
Destination Retirement is a completely new kind of financial planning and advice service.
It’s designed to help people feel confident and liberated when making key decisions about their pensions, savings or investments, and it’s been developed using the latest technology.
Destination Retirement helps people paint a picture of what their life after work could look like, and gives them a free personal retirement plan which they can adjust as often as they like. It then provides expert financial advice on how to make their plan a reality.
Best of all, this advice is fully regulated by the Financial Conduct Authority (the UK’s financial watchdog).
People can plan on their own, or with their spouse or partner, in the comfort of their own home.
And although it’s an online service, there’s a team of friendly experts on hand to provide help whenever it’s needed.
Destination Retirement is provided by HUB Financial Solutions, part of Just Group plc. Just are one of the UK’s leading providers of financial products and services for people approaching and in retirement, and have been trusted to manage over £23 billion of people’s retirement savings.
Find out more at Destination Retirement here.