Why do I have to use a Financial Advisor?

gradyj12345

Trying to access my Prudential pension, and I know EXACTLY what I want do (take 25% tax-fee and put the rest in drawdown), but Prudential (and others) say I have to go through a Financial Advisor.

I don't need one - why is this 'compulsory'?

Where can I transfer the pension so that I don't need to pay for something that I already know?

Pension_Geek

Prudential only sell their draw-down product via Financial Advisers. Its a business decision they have made.

Provided the plan doesn't have safeguarded benefits, you could transfer it to another provider 'Execution only' and do what you want. If it does, and is over £30k then you will need advice.

lisyloo

It’s worth checking that what they are telling you is correct and not just their interpretation, but if it’s the law then you won’t be able to avoid it.

gradyj12345

Thanks. I knew that it was a "business decision", but I still don't know why, unless it's to make money?

It is over £30k, but I don't need advice; I know exactly what I want to do. I understand all the implications and simply want to access the money.

It doesn't seem right to me that I have to talk to someone and we will still come out with the same answer in the end?

gradyj12345

Is it the law?

Pension_Geek

gradyj12345 wrote: »

Thanks. I knew that it was a "business decision", but I still don't know why, unless it's to make money?

It is over £30k, but I don't need advice; I know exactly what I want to do. I understand all the implications and simply want to access the money.

It doesn't seem right to me that I have to talk to someone and we will still come out with the same answer in the end?

The £30k thing is not the issue, its if there are safeguarded benefits. Some of the older Pru plans (or ex Scottish Amicable plans) have guarantees attached to them. These guarnatees can be valuable and therefore the Government requires advice to be given on the suitability of giving them up.

dunstonh

Thanks. I knew that it was a "business decision", but I still don't know why, unless it's to make money?

Regulation and compliance. There are different requirements if you handle distribution direct to consumer and via intermediaries. If the provider doesnt think they will get enough business via one distribution method to justify the costs of compliance and regulation then they will choose not to operate in that area.

Is it the law?

No. Manufacturers are free to decide what products they retail via retailers and what they may or may not offer directly.

If you dont want an adviser then chose a provider that caters for the direct to consumer market. Don't choose a provider that caters for the intermediary market.

AnotherJoe

If it doensn't have safeguarded benefits (does it?) , then transfer it to someone that does drawdown. AFAIK that transfer involves no fee.

Pension_Geek

AnotherJoe wrote: »

If it doensn't have safeguarded benefits (does it?) , then transfer it to someone that does drawdown. AFAIK that transfer involves no fee.

THats the crux of it really, Is it, that the OP needed advice to take out a Pru plan, or is the advice requirement because of safeguarded benefits.

gradyj12345

Where do I find a list of Pension providers that I can transfer to with no IFA and/or no fees?

Silvertabby

gradyj12345 wrote: »

Where do I find a list of Pension providers that I can transfer to with no IFA and/or no fees?

Just google 'free pension review' - but don't come back here crying because a scam company has run off with all of your money.