You are highly likely to have to pay fees to use a financial adviser when you want to sort out your pension - however, whilst the fees can sometimes be high, good advice should always represent value for money.

Do I need a financial advisor to transfer my pension?

If you have what's called 'safeguarded benefits' – in particular if you're in a defined benefit pension scheme or have a guaranteed annuity rate – and your benefits are worth £30,000 or more, you'll have to take regulated financial advice before you can transfer.

How much does a financial advisor charge in the UK?

There are some average guidelines for you here, as you could pay an adviser in a number of different ways, including: -

  • An hourly rate - this will vary from £75 an hour to £350, although the UK average rate is about £150 an hour. 

  • A set fee for a piece of work -this could be several hundred or several thousand pounds. 

  • A monthly fee -this could be a flat fee or a percentage of the money you want to invest.

Can I leave my pension to my daughter (or any other family member or friend)?

The rules on passing pension wealth to beneficiaries changed recently. Now, if you die before your 75th birthday, you can leave your unused pot to any beneficiary you choose free of tax. If you die after 75, your beneficiary’s income will be taxed at their marginal rate of income tax.

Does it cost to transfer pension? 

Depending on the rules of your scheme, you may be required to pay pension transfer charges in the form of an exit fee. This fee will be charged by your current pension provider when you try to withdraw your retirement savings, and will be deduced from the balance of your pension.

When do I need to see a financial adviser?

Consider speaking to a financial adviser if you want to:

·         invest your pot to receive a flexible income – an adviser can do this for you

·         mix your pension options

·         pay more money into your pension

·         leave some of your pension in your will – they can advise on the most tax-efficient way to do this

Do I legally need to use a financial adviser?

You must get independent financial advice, by law, if you have a:

·         final salary or career average pension (known as a ‘defined benefit’ pension) worth more than £30,000 and you want to transfer it to a defined contribution pension scheme

·         defined contribution pension worth more than £30,000 with a guarantee about what you’ll be paid when you retire (eg a guaranteed annuity rate) and you want to give it up to do something else with your pot

You should also consider speaking to a financial adviser if you want to do either of these and your pension is worth £30,000 or less.

How do I choose my financial adviser?

  • Check your adviser is authorised by the FCA.

  • Search the Money Advice Service’s retirement adviser directory to find an adviser.

What’s the difference between independent and restricted advisers?

Always ask an adviser if they’re independent or restricted.

Restricted advisers are limited to certain types of products (eg only from certain lenders or financial institutions) or the providers they can choose from. Independent advisers cover the whole market.

How much should I pay for financial advice?

The fees for getting financial advice vary. Before you get advice, ask the adviser:

·         what the fees and charges are

·         when you’re expected to pay

·         if there’s a fee for an initial consultation – many advisers offer this for free

You’ll pay a one-off fee if you see the adviser once or a regular fee if the advice is ongoing.

Can I take my pension at 55 and still work?

Whether you have a defined benefit or defined contribution pension scheme, you can usually start taking money from the age of 55. You could use this to help top up your salary if you are still working, to enable you to work fewer hours or to retire early.

What percentage of my salary should I put into pension?

There's a very rough rule of thumb for what to contribute for a comfortable retirement: take the age you start your pension and halve it. Then put this % of your pre-tax salary into your pension each year until you retire.  However there is no substitute for asking a financial adviser to draft a tailored plan to meet your specific needs.

Is it worth starting a pension at 55?

Bear in mind that, by law, you cannot withdraw anything before age 55. If you're in or nearing your 50s, it's particularly worthwhile using a pension, as there's not so long to wait until you can access the cash. The growth will be limited with less time until retirement, but the tax breaks are still worth having.

Is a Pension mandatory in the UK?

Under the Pensions Act 2008, every employer in the UK must put their qualifying employees into a pension scheme and, where appropriate, pay contributions. This is called 'automatic enrolment'. If you employ at least one person you are an employer and you have certain legal duties.

How many years do you need to work in the UK to get a pension?

Under these rules, you'll usually need at least 10 qualifying years on your National Insurance record to get any State Pension. You'll need 35 qualifying years to get the full new State Pension. You'll get a proportion of the new State Pension if you have between 10 and 35 qualifying years.

Start planning your future. Speak to us today.

Contact Us

Seventy Financial Planning
The Apple Store, Haggs Farm,
Haggs Road, Follifoot, Harrogate,
HG3 1EQ

01423 611004

[email protected]

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