More than six-in-ten people aged over 55 do not plan to take any financial advice when they retire, something that could cost them thousands of pounds in later life.
Research conducted by LV= shows a high proportion of people approaching retirement will not take any advice on their future finances. More than half of those surveyed (52%) say they believe they can make the correct financial decisions without advice.
But it appears there is confusion about what consumers get for their money when paying for advice. A third of people were not sure of the difference between advice – which is given by a regulated adviser – and guidance – which isn’t regulated – while 15% of people thought it was too expensive.
Recent government changes have given people greater flexibility over their retirement options but 22% of people still believe they don’t have enough cash to make advice worthwhile.
Philip Brown, head of policy at LV=, says: “The poor understanding of financial advice is particularly worrying at a time when consumers are faced with more complex decisions about retirement than ever before.
“Taking financial advice is vital to ensure consumers are equipped to make the most of their hard-earned savings and get the income they need in retirement.”
Meanwhile separate research published by financial advisers Chase de Vere shows that people who have taken out advice are likely to be in a better financial position when they reach retirement.
After taking advice, 56% of people increased their pension contributions versus just 27% of those who hadn’t taken advice.
Around 58% of people who receive advice are also confident that they will be able to retire when they want. This compares to just 30% of people who don’t receive any advice