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Half of retirees have no plan for pension freedoms

A new survey shows half of people retiring next year under the new pension freedoms have not begun to assess their options.

In a survey of 500 investors about to retire, Fidelity Worldwide Investment found three quarters will seek help with 35 per cent planning to use a regulated adviser, 21 per cent friends and family and just 20 per guidance.

The surveyed group are retiring between April 2015 and 2016 with a mixture of defined contribution, defined benefit and Sipps with an average pot size of £115,845. 

The report found 47 per cent have not started assessing their retirement options, while just 17 per cent have a clear retirement plan.

Meanwhile, 15 per cent of the people retiring post April 2015 are re-visiting their pension plans in light of the reforms.

There were also a substantial number of individuals who felt unable to manage their income over a lifetime.

Of those surveyed 46 per cent felt unable to manage their retirement income, rising to 57 per cent for those with a pot of £50,000 or less.

While 48 per cent think the new pension rules have made it easier to plan for their income needs in retirement, one quarter feel it will be harder.

Concerns were also raised about the technicalities of accessing tax-free lump sums and whether to spend or re-invest the cash.

Fidelity Worldwide Investment retirement director Alan Higham says: “Not every pension provider will offer full freedom to customers and so people need to be prepared to move firms well before wanting to take any benefits.

“Advisers will play a key role in checking whether providers will offer the solutions their clients need and, if not, making sure it is safe to move providers without harsh penalties or losing other valuable benefits.”

FundsNetwork head of advisory services Jon Everill says: “The new rules present a huge opportunity for advisory firms, which are best placed to help retirees navigate through the increasingly intricate pensions maze to ensure they get the best retirement outcomes.”


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