This is a crucial year for all pension savers, and in particular for those now approaching retirement.
Just a glance through the financial pages of your newspaper will tell you about the new pensions freedoms that came in at Easter, which now enable you to take out chunks of your pension savings (or the lot!) using a growing range of income drawdown products.
You can look at the many options for re-investing that cash.
Alternatively, if you decide to take the traditional option of turning your money into a regular pension income for your retirement, you can buy a pensions annuity from the wide range available on the market.
You may also see industry experts recommend that you make good use of your Open Market Option or ‘OMO’, which gives you the right to shop around for the best annuity rate available to you.
The annuity you get can vary widely, and, depending on your lifestyle and health, you may even qualify for a higher annuity income if you are eligible for an ‘enhanced’ or even an ‘impaired’ annuity.
If you decide to re-invest your pension pot, the options are more varied still.
It would appear that the argument for taking quality, independent financial advice is more of a ‘no-brainer’ than ever before!
This is why it may be time to address the hesitation that many people feel over doing just that.
The ‘2015 Value of Advice’ report by the UK financial research company unbiased.co.uk together with the insurer MetLife claims that 40% of people who make their own investment decisions without first taking advice do so because “they are confident they can make the best decisions for themselves.”
Just 11% listed the cost of making decisions and setting up investments using an adviser as a factor which discouraged them from seeking advice.
The report found that a further 14% of people don’t believe they are even suitable to receive advice, and 6% are relying entirely on free online information instead.
We know the recent new options and flexibilities referred to above have turned what used to be a tangle of possibilities into a thicket.
Decisions are more complex than ever before, and the report pulls no punches when it states: “life-changing sums of money may be at stake if people don’t make wise financial decisions, so those taking a DIY approach to these critical choices may well live to regret it.”
The report concludes that a general sense of financial confidence is not at all the same as an in-depth knowledge and experience of financial products, allowances, regulations and “what if?” scenarios – and emphasises that a non-specialist can’t possibly be expected to keep on top of all that.
Professional advisers make it their business to know these things, and can tailor your financial plan accordingly.
The bottom line is that good advice will give you true confidence that you are doing the very best you can with your money.
This article does not constitute financial advice. Brian Kennedy is a chartered independent financial adviser within Priory Financial Planning Ltd., and can be contacted on 028 9042 5025 or firstname.lastname@example.org. Priory Financial Planning Ltd is an Appointed Representative of TenetConnect Ltd which is authorised and regulated by the Financial Conduct Authority (FCA)