An overhaul of the pension system is well on the way and key reforms announced late last year are in place. Almost every aspect of saving for your retirement has been the subject of scrutiny and change, but has it been well received?
Changes announced from the 2014 Budget means more people will be able to retire and pull money from their pension without buying an annuity. The introduction of the Pension Freedom Strategy has given people greater power on how they spend, invest or save their money.
This reform means you can gain access to your entire pension from the age of 55. Chancellor George Osborne announced last year that people will be able to dip in and make unlimited amounts of withdrawals from their pension.
Despite mounting anticipation over the Pension Freedom Strategy, concerns have been raised that many pension firms are not conforming to these new services. This is coupled with another concern that experts are extremely nervous about what people might do with their new freedoms. But there is a general principle behind the process that if people have worked hard and saved hard all their lives they should be trusted with their own money, as explained by the Chancellor of the Exchequer.
Standing in for the PM David Cameron at Prime Minister’s Question Time, Osborne said; “We are investigating how to remove barriers and we are now considering a cap on charges.
But it’s clear that the Chancellor is losing patience with the industry, as some companies are not playing their part.
The process is being hampered by industry red tape. People are claiming that they’ve been left in limbo as pension firms insist they consult an adviser (for an additional cost) yet…understandably, they couldn’t find one prepared to accept their business due to fear of the legal backlash from their clients if they ran out of money later in their retirement.
Standing in for the PM David Cameron at Prime Minister’s Question Time, Osborne said; “We are investigating how to remove barriers and we are now considering a cap on charges”.
So far, records suggest that some 60,000 people have made use of the new reform and that £1billion has been transferred out of people’s pension funds as a result to the Pension Freedom Strategy.
Can this be classed as a success?
I personally think we won’t benefit from the success of this strategy for many years. We’ll have to see if those people who have withdrawn the money from their pensions are still enjoying the retirement they planned and saved many years for.
Here at Collect a Case we work with our Pension accounts to ensure that all required documentation is returned promptly and efficiently. We understand the frustration of waiting for the important document(s) complete with client signature(s) and supporting paper work to arrive back to you safely. We can help speed up your processes – with our national network of professional agents to take advantage of, you can be assured your documents are in safe hands every time.