Could Not Seeking Advice Prove Costly for Your Retirement?

It’s becoming more common for people to access their pensions without professional advice and there are no signs of it slowing down.

But why’s this a problem?

While managing your pension yourself might seem like a good way to save time and avoid fees, the truth is it’s more complicated than it looks. What might seem simple on the surface can carry some hidden risks.

Retirement planning has become more complex over time, and with the current economic uncertainty, making these decisions on your own could lead to some serious long-term consequences you didn’t expect.

Here, we’ll discuss why more people are accessing their pensions without advice, the risks involved, and why seeking professional advice still matters.

The Rise of Managing Pensions Without Advice

Let’s look at the facts. Recent data shows more people are taking money from their pensions without getting professional advice.

According to the Financial Conduct Authority (FCA), in 2023/24, only 30.9% of people accessed their pensions with advice, down from 32.9% in the previous year.

This suggests more people are choosing to manage their pensions on their own, likely to avoid fees, or because they think managing their retirement funds is straightforward.

But the reality is, the stakes are much higher than they might think.

There’s also been a close to 20% increase in the number of pensions accessed for the first time, possibly due to the rising cost of living pushing people to dip into their savings earlier than planned. Discover how this might affect your retirement plans here.

While options like annuities and drawdown plans are becoming more popular, there’s concern that without proper advice and guidance, people may make decisions that won’t support their long-term retirement needs.

Why is this Happening?

There are a few reasons why more people are choosing to access their pensions without seeking advice.

With prices rising for everyday essentials, many people feel they have no choice but to tap into their pension savings to help make ends meet. It’s a tough spot to be in, and that need for immediate financial relief is understandable.

Another reason is the belief that there’s plenty of information online that can guide them through the process. While the internet can offer useful information, pensions are often more complicated than they appear. Following general guidance might result in choices that don’t truly match your long-term financial goals. After all, what someone needs for retirement aren’t the same for everyone because each person has their own unique goals and desires for their retirement years.

In times like these, having a trusted advisor can make a world of difference. We’re here to help you sort through the noise and find the best path for your future. Remember, you’re not alone on this journey and there are people out there who want to help you.

The Risks of Going it Alone

While it may seem like a straightforward choice to access your pension without professional advice, the reality is that it’s a lot more complex than it appears. Making decisions about your retirement funds can feel overwhelming, especially when you’re trying to juggle immediate financial needs.

The risk of withdrawing too much too soon or missing out on potential tax-saving opportunities is real, and it can leave you with less money than you need to maintain your desired lifestyle throughout retirement.

It’s essential to remember that even though seeking financial advice isn’t always legally required, having that personalised support can truly make a difference.

Why Financial Advice Still Matters

When you sit down with a Financial Advisor, you’re not just crunching numbers; you’re creating a personalised plan that considers your long-term dreams, lifestyle preferences, and any potential risks that might come your way.

It’s about finding that perfect balance between addressing your current needs and securing your future.

Think of your advisor as a partner in your retirement journey. They can help you find out the often-choppy waters of Financial Planning, making the process feel much smoother and simpler.

While there’s no one-size-fits-all approach, having a Planner’s input can empower you to make informed decisions with confidence.

After all, your future is important, and you deserve to feel secure in the choices you make.

Looking to the Future

It’s becoming clear that many people might need a little more guidance than they realise. With the Government’s ongoing pension review and potential regulatory changes on the horizon, having access to clear advice and support is likely to be even more crucial for anyone planning their retirement.

It’s so important to have someone in your corner. So, whether you’re just starting to think about retirement or you’re already in the thick of planning, know that you’re not alone, and the right support can make all the difference.

Let Us Help You

At Joslin Rhodes, we’ve been proudly supporting local Teessiders in their retirement journeys for over 20 years. Our dedicated team of experts is here to simplify the retirement process for you, ensuring you feel informed and supported every step of the way.

We understand that planning for retirement can feel overwhelming, but you don’t have to deal with it alone.

Let us help you understand the complexities and give you with the peace of mind you deserve. Reach out to us today, and together, we can start crafting a more secure and fulfilling future for you.

Joslin Rhodes Pension & Retirement Planning – Real Advice, For Real People