Article by Phil
According to a survey by the Capital Group. Millennials (aged between 30 and 45) are most likely to listen to fin influencers than financial advisors when it comes to investment decisions and their pension advice service.
27% said they would look to a fin influencer on social media for a pension advice service. As opposed to 18% who would speak to a financial adviser. This is despite fin influencers having no formal financial qualifications and not being regulated by the Financial Conduct Authority (FCA). That means that if their investment tips and advice go wrong that there is no protection from the Financial Services Compensation Scheme (FSCS). This is why the FCA are keen to clean up social media and take down harmful and often misleading content form fin influencers. But the figures show that much more needs to be done.
The survey found that most of money being invested my Millennials had come from inheritance. In other words, from wealth carefully invested and grown by parents and grandparents. Probably using the help of a financial advisor. But certainly not with any input from a fin influencer.
Having said that, in the UK more people do still use financial advisers. With 32% talking to a financial adviser. This falls to 15% in the US.
Free pension advice service.
Even if you don’t use a financial advisor, it would make sense to do your own research. For example, when you are thinking about retirement it might be helpful to visit the Retirement Living Standards website. This is run by the Pensions and Lifetime Savings Association and is designed to give you guidance on how much you will need to have saved when it comes to your retirement. It helps you to understand what the costs of retirement are likely to be. This is a free pension advice service resource, so it’s worth looking at.
Pension Wise is another government backed website which offers free help and guidance for those looking to retire. The website is called Money Helper. You can also make a free pension advice service telephone appointment to speak to one of their specialists. They will talk to you about your retirement options and how tax affects your choices. They can also help you to spot scams. They are not financial advisers however, so they can’t help with your specific personal circumstances.
Getting help is important. Aviva found that a third of people between 45 and 60 were confused about the pension information they’ve received. 50% said that they weren’t sure about what type of pension income would suit them best. Two thirds said they were unprepared for retirement. Slightly worrying for those sixty-year-olds in the survey! Especially with mounting concerns about the impact of Inheritance Tax changes and pensions.
Inheritance Tax looming.
The amount of money flowing down the generations through inheritance is set to be taxed even more going forwards. With the new Inheritance Tax (IHT) rules on pensions coming into force by 2027. Quilter estimate that 20% of families will be pulled into the Inheritance Tax net because their pensions will be taken into Account.
Currently less than 5% of estates are subject to IHT but that is set to change. More advice on inheritance tax planning will be needed.
Some pension providers are also concerned that the new IHT rules will slow down pension payments on death. Because they will need to take into consideration IHT liabilities. It’s not clear yet whether that will be the case.
Get more information.
For more information about the pension advice service available from your local financial adviser, why not contact Christina today. We offer a free initial meeting to discuss your requirements and explain how our service works. You are under no obligation to use us after that if you don’t want to and we won’t pester you.
So why not call us today on 01282 614444 or e mail us enquiries@ccfps.co.uk or use our contact form online.
