D.I.Y is not the way!

There are always plenty of articles in the financial press about pensions and, one in particular, caught my eye this week. It comments on Drawdown and, the numbers of policyholders not taking advice before accessing their pensions.

The Financial Conduct Authority (FCA) has expressed concern about this and, is questioning whether people end up with the best financial solution for their personal circumstances.

Saga discovered from a recent poll it conducted that about 1 in 7 retirees had accessed their pensions without advice. Based on figures released by HMRC – which revealed that savers had accessed around £23.6bn since the advent of Drawdown – Saga estimated that this amounted to a figure of some £3.2bn, of pensions taken without any advice!

When one considers that Saga’s research also revealed that around 84% of UK adults are in the dark about the new rules then a further interesting fact comes to mind, which is that people paying for advice usually end up with having a more secure financial future than those who don’t.

The FCA found that around 50,000 (33%) of non-advised consumers were just holding cash! So that would be money taken from the tax-advantageous environment of a pension plan, which would (generally) be growing at more than a cash deposit interest rate and, outside of the policyholder’s estate for Inheritance Tax purposes, just moved into a very low growing and potentially taxable cash deposit which would form part of their estate for death duties!

Ask yourself, would you buy a house and do your own conveyancing? Would you trust your medical diagnosis to a ‘large medical book’ borrowed for your local Library or, a search engine? Almost certainly not. If you know anyone intent on DIY-ing their financial future, please highlight the benefits of taking advice to them.


This information is provided strictly for general consideration only. No action must be taken or refrained from based on its contents alone. Accordingly, no responsibility can be assumed for any loss occasioned about the content hereof and any such action or inaction. Professional advice is necessary for every case.


Neil Dainton Financial Planner