Part 1 of 3: Pension reform 2015
In the first instalment of this 3-part series, Money Marketing’s Head of News, Thomas Selby explains all you need to know about the 2015 pension reform.
Chancellor George Osborne stunned the pensions industry when, delivering his penultimate Budget speech in March 2014, he announced the most radical overhaul of retirement rules in almost a century. The idea is simple – the Coalition believes people aged 55 or over should be trusted to spend their retirement nest egg as they see fit. But the ramifications of the changes are potentially enormous for individual investors, the UK as a whole and future generations.
Sarah Pennells, founder of consumer finance website SavvyWoman.co.uk, adds:
To mitigate these concerns, the Government has launched Pension Wise – a free-to-use guidance service that explains the options available to investors and the potential tax implications of taking too much money at once.
The new pension freedoms offer savers far greater freedom over how they spend their hard-earned pension pots. Some will inevitably be reckless and splurge their new-found wealth on sports cars and expensive holidays, while others will explore a range of investments, including property.
But pensions remain hugely complex and most people with a reasonable sized pot would benefit from discussing their options with a regulated financial adviser.
For those with smaller pots or who don’t want to pay for expert help, the Government’s guidance service (www.pensionwise.gov.uk) is a good place to start