Aegon regulatory strategy director Steven Cameron says providers need to do a better job of explaining what can be done within pension products or with pension funds.
“People think if it’s in their bank account they have ready access to it when they need it, where as they probably don’t think that’s the case within their pension.
“Investing in a bank account is hardly an investment strategy apart from that your money can’t go down in value in nominal terms.”
If you have very small pensions and require a cash amount then cashing in your pot, taking the money and putting the rest in a bank account isn’t too much of a problem. But for bigger pots above £30,000 the tax consequence, impact of inflation on cash, and the lowering of bank deposit guarantees need to be made absolutely crystal clear.
That´s where Blacktower can help you – we work hard with all our clients to find the best and most tax efficient investment plan to suit your individual needs. We are completely independent so can offer you products from various providers from across the financial market place.
This communication is for informational purposes only and is not intended to constitute, and should not be construed as, investment advice, investment recommendations or investment research. You should seek advice from a professional adviser before embarking on any financial planning activity. Whilst every effort has been made to ensure the information contained in this communication is correct, we are not responsible for any errors or omissions.
Official figures have revealed that pension funds have plummeted a further £25 million into the red. The fall in bond yields – on which pension funds rely – has increased the pressure on the pots available to support final salary scheme pay-outs. At the end of May, the pension backstop PPF (Pension Protection Fund) revealed that the roughly five and a half thousand pension schemes it monitors have a combined deficit of nearly £295 billion. This is almost £25.5 billion worse than a month earlier.