Savers trying to transfer out of defined benefit pension schemes will find it increasingly difficult to find an qualified adviser willing to take on the work, experts warn.
This week Hargreaves Lansdown revealed it had to stop accepting DB transfers after hitting capacity. It has had to turn away clients after being overwhelmed by a doubling in the number of people asking for advice.
New FCA rules mean members transferring safeguarded benefits worth more than £30,000 must first see an adviser holding the specialist transfer qualification.
Hargreaves says it is likely the stoppage will be “days and weeks, rather than weeks and months”.
It has not confirmed how many transfer specialists it employs or how many transfers it advises on.
Advisers say the problem is being echoed across the industry as firms shy away over concerns over insistent clients.
Furnley House director Stefan Fura holds the pension transfer qualification. He says his firm is receiving a record number of enquiries.
He says: “There is also the issue around the guidance on how you make the comparison between DB and DC in light of the new flexibilities.
“It’s resulting in having to spend more time with clients. I’m sometimes having one or two extra meetings, it’s really important these high risk decisions are carefully documented.”
Rowley Turton director Scott Gallacher says: “There’s bound to be people struggling to find an adviser. It’s a perfect storm, there probably hasn’t been an increase in pension specialists but there is much greater demand.
“It will be a growing problem and it’s not ideal for advisers. I suspect the view that people shouldn’t have to take advice but financial services should pick up the tab if things go wrong will grow too.”