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Govt ‘guidance guarantee’ website goes live

The online version of the Government-backed guidance service Pension Wise has gone live today.

The Treasury-designed website – pensionwise.gov.uk – focuses on six steps users should take in deciding how to turn their pension pot into retirement income.

They are:

  • checking the value of the pot;
  • understanding the options;
  • planning how long the money needs to last;
  • working out how much is needed in retirement;
  • being aware of the tax implications;
  • shopping around for the best deals.

Financial advice is referenced at the end of the shopping around section. The site explains that advisers will “look at your circumstances and recommend what you can do with your money”, recommends asking whether advisers are independent or restricted, and explains that fee structures may vary between advisers.

It then points users to the Money Advice Service website for tips on choosing an adviser. MAS’s adviser directory has opened for registration but is not yet live.

There is also information on how to avoid pension scams, living abroad and how the benefits system interacts with pensions.

The site is currently in ‘beta’ mode, meaning it is under development.

Citizens Advice will be delivering the face-to-face aspect of the guidance guarantee, while The Pensions Advisory Service is running telephone support. The Government predicts the bill for the first year of Pension Wise will run to £35m, with advisers set to pay over £4m.

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Comments

There are 6 comments at the moment, we would love to hear your opinion too.

  1. Initially I have to say this looks very good and easy to follow….plently of clear info and appropriate warning statements……would be interesting to see how each confirmation of appointment making service differs for each of the 6 retirement timeframes or whethe rthey are all the same.

    Also, it looks like the system intends to point people towards seeking regulated financial advice during many parts of the process (presume this will be the same on the phone and face to face)……my two concerns are:-

    1) – what are the criteria that results in a face to face with a CAB caseworker (ie, will it be all clients with a DB scheme) or already in drawdown for example, and

    2) – the State Pension forecast is critical to every consumer looking to take benefits from 55, after all this is still the foundation of retirement income that everything else sits on top of, so the big problem here is the BR19/State Retirement Forecast service currently being used as it still uses the current income calculation based upon a person’s NI and earnings history (and contracted-out history) but does not reflect what is going to happen from 6th April 2016 when the new flat rate pension comes in. It does not take into account the amount of reduction on the new flast rate pension a person will suffer for being contracted-out…..I have lost count on the number of people I have spoken in the last 2 years that think their basic state pension is going up to c£150 per week and their additional pension gained by contracting-out (be that via a PP/SHP or in a contracted-out company scheme) will not be affected. This lack of detail will inevitably result in some people making the wrong decision with some or all of their pension pots by taking them and using them in the wrong way….thus leading to financial hardship.

    So I appeal to The Pension Service to get the post April 2016 forecast tool in use as soon as possible before some consumers make irriversible errors of judgement.

  2. the elephant in the room 11th February 2015 at 6:53 pm

    Well I certainly cannot foresee any problems whatsoever with this government initiative. Who needs advice anyway?

    Now where is my diploma? I’m sure my daughter could make a nice origami frog out of it!

  3. the elephant in the room 11th February 2015 at 8:03 pm

    Well I certainly cannot foresee any problems whatsoever with this government initiative. Who needs advice anyway?

    Now where is my diploma? I’m sure my daughter could make a nice origami frog out of it!

  4. Martin Wheatley and the FCA take note !!

    How long has it taken you just to issue guidance to the people you regulate ?

  5. Seems to cover all the basic issues and information required with the bonus that people are being channelled towards regulated advisers. The best bit being that the public are being told to make sure their adviser is regulated by the FCA.

    However, the issue was never going to be about what the Pension Wise website provided in terms of general information. The issue was always going to be what did individuals get from the service and do they leave the guidance provider with a clear idea as to what they are going to do with their pension pot.

    Only time will tell.

  6. On first read, they’ve done a good job at trying to explain very complex options in as simply a way as possible but I still sense that it is still going to leave people totally confused.

    My biggest concern however is that there is absolutely no reference to life expectancy in the ‘Plan how long your money needs to last’ section. Hopefully they are still working on this bit!

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