In April this year, new rules were introduced to allow people aged 55 and over to cash in their pension pots instead of taking a retirement income (as we previously reported on)
It’s believed that 204,000 people have accessed their pension pots since April 2015. This was more than double the number in the same period in 2013, partially reflecting customers’ intentions to delay gaining access to their pension savings until the reforms had taken place.
Roughly 121,000 customers had opted for total cash withdrawal and 71,000 had accessed some form of product to draw income from a pension fund that would still remain invested.
An MP committee has commented that making these financial decisions has left many people at risk of being exploited by con-artists.
The Government responded by saying it was working hard to tackle the issue
“The Government has been absolutely clear that any attempt to exploit people who have worked hard and saved for their retirement is unacceptable, which is why we are working with police, regulators and other bodies to raise awareness and take action to protect consumers.”
It’s clear that a lack of proper advice for many people approaching retirement is the problem and the dangers of mis-selling scandals are apparent if pensioners are unable to make informed choices.
We literally cannot afford another financial mis-selling scandal, says the Treasury. Clearly platforms provided by the Government aren’t working.
The criticism of Pension Wise, the Government-backed free service website which guides people through the new rules, has been deemed too static and offers no opportunities for personalisation.
It also offers phone-based services, as well as face-to-face appointments through the Citizens Advice Bureau.
However, the Government said Pension Wise had been a real success story, and that over 20,000 guidance appointments had been booked since it started. But conversely the City watchdog, the Financial Conduct Authority, told the committee that in July the Citizens Advice Bureau was functioning at 10% to 15% of its capacity in order to provide face-to-face appointments.
It seems yet again that certain individuals are lurking, waiting to pounce on the vulnerable. A scary thought, especially at this time of year with Halloween just around the corner.
At Collect a Case we work with highly reputable pension companies and we ensure that all required documentation is returned promptly and efficiently. We expect and trust that the situations we’re dealing with convey precise and authentic information and provide clear and honest cases.