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    • AndyAdams
    • By AndyAdams 15th Jul 17, 12:09 PM
    • 24Posts
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    AndyAdams
    More regulation?
    • #1
    • 15th Jul 17, 12:09 PM
    More regulation? 15th Jul 17 at 12:09 PM
    I have seen a few articles recently about individuals drawing money out of SIPPS without taking advice, and there seems to be a level of concern, no idea if it is justified. I am concerned in the future there may be additional regulations enforcing Pension DIYers to take financial advice before pension funds can be accessed.

    If so I don't want to have to consult and FA or IFA to take money out of my pension and incur, what in my opinion often appear to be ridiculous fees, and it may mean I will revert to ISAs.

    What do you think the chances of the above happening?

    Cheers
Page 1
    • dunstonh
    • By dunstonh 15th Jul 17, 12:55 PM
    • 89,852 Posts
    • 55,456 Thanks
    dunstonh
    • #2
    • 15th Jul 17, 12:55 PM
    • #2
    • 15th Jul 17, 12:55 PM
    I have seen a few articles recently about individuals drawing money out of SIPPS without taking advice, and there seems to be a level of concern, no idea if it is justified.
    If the article said SIPPs then the article is wrong. The report didnt go into pension types.

    Like most generalisations based on limited stats, there will be some truth and some assumption. Those assumptions will have some right and some wrong.

    The FCA are correct that many of the people that DIY end up in worse outcomes. However, many of those that DIY also end up in suitable outcomes and didnt switch because they were already in a DIY product that was suitable and didnt need to switch.

    I am concerned in the future there may be additional regulations enforcing Pension DIYers to take financial advice before pension funds can be accessed.
    It's not going to happen. For example, it's also known that consumers that see advisers generally end up with a bigger pension than those that do not. Yet, the DIY market still exists.

    There is no longer the capacity within the marketplace to give advice at the level that would be required with compulsory advice. Adviser levels are at 1/10th of what they were at their peak.

    If so I don't want to have to consult and FA or IFA to take money out of my pension and incur, what in my opinion often appear to be ridiculous fees, and it may mean I will revert to ISAs.
    Although you may feel you can DIY cheaper, there are plenty of people doing DIY in far more expensive options than the advisor options (inc cost of advice).

    For example, I did one last week where the adviser charge was £1500. No other initial charges and the ongoing charge was 0.4% all in. That is going to save the person about £900 a year and they will have around 8 years before they need to access again. The same provider had a DIY option at 1.0% all in with no adviser charge and that was what the person was considering before they spoke with us.

    If you DIY well, it can save you money. If you DIY badly and can cost you more.
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