Just five per cent of defined benefit schemes provide access to a named financial adviser selected by the trustees or employer.
While nine in ten schemes stress the importance of seeking financial advice to members, a new report from Royal London and management consultants Lane, Clark and Peacock shows significant gaps in getting the required help.
The report says: “Whereas a transfer out of DB rights worth £30,000 or more carries a requirement to take financial advice, there may be no advice required or available with other options, despite the complexity of choosing between them.
“Occupational pension schemes should provide more comprehensive information to scheme members about their options regarding their DB pension rights, especially in light of the pension freedom reforms of April 2015. This information needs to be supplied earlier, communicated clearly and supported by access to high quality advice and guidance.”
A survey of advisers as part of the research shows that nearly 60 per cent of advisers “strongly support” the right to a partial DB transfer, as typical transfer values have increased to between 25 and 30 times annual pension entitlement.
More than a quarter of advisers surveyed said they had seen an increase of more than 80 per cent in DB transfer enquiries.